Why the market is taking Powell’s ‘soft-ish’ economic language so hard: Former Fed official Roger Ferguson – CNBC
Anyone who read Jerome Powell’s term “soft-ish” for an economic landing as a bullish signal should understand that stocks tanked on Thursday, May 5th, after the relief rally, giving up all of the post-FOMC meeting gains and more, on pace for the worst day of 2022 for stocks.
Roger Ferguson, a former Fed vice chair, said the Fed could only do so much to control inflation caused by supply chain disruptions, geopolitical shocks, and strong demand.
Ferguson told the CNBC Small Business Playbook virtual event that the Fed’s forecast suggests inflation will remain above 2% for a couple of more years. That small business should expect inflation to remain high for more than a year.
Powell said the Fed has ‘notoriously blunt’ tools to bring inflation back down to 2% and that it will slow and become less of a factor in business decisions.
Ferguson said small businesses are a massive driver of the economy and job growth, but the next 12 to 18 to 24 months will be rocky.
Read more on this topic at the following additional news sources:
- Why the market is taking Powell’s ‘soft-ish’ economic language so hard: Former Fed official Roger Ferguson CNBC
- Markets may have ignored some uncertainty from Fed Chair Powell, says Roger Ferguson CNBC Television
- Powell throws stock bulls a bone — here’s how to invest Yahoo Finance
- Powell Puts Volcker on Hold The Wall Street Journal
- Did Powell put a floor under stocks? Kitco NEWS