What’s Happening in the World Economy: Powell Persuades Wall Street on Fed
Hello. Today we look at how bond traders now agree with the Fed, why London’s future matters so much for the U.K. economy and which central banks are the most dovish.
Wall Street appears to be coming around to the view of Federal Reserve Chairman Jerome Powell and his colleagues on the argument that the current surge in inflation won’t last.
The trading of U.S. Treasuries suggested as much on Thursday, when the latest reading on the consumer price index showed the third straight bigger-than-forecast monthly climb. After an initial drop, Treasuries rallied, sending 10-year yields to the lowest level in three months. Stocks hit a record high.
That was despite the data showing consumer prices surging 5% in May, the most since 2008, from a year ago and more than forecast from April.