The Fed is strongly signaling that its aggressive interest rate hike regime will come to an end soon, citing robust economic conditions and inflation moving lower.
“We no longer state that we anticipate that ongoing rate increases will be appropriate to quell inflation,” Powell said. “Instead, we now anticipate some additional policy firming may be appropriate.”
Powell noted the shift from the Fed’s previous stance centers on the words “will” versus “some” and “may.” The message is that further rates aren’t guaranteed.
“The end of the rate hiking cycle is in sight,” said Jamie Cox, managing partner at Harris Financial Group. “The Fed is trying to navigate the very narrow path between defeating inflation and destroying the economy with blunt force rate hikes — even they now know the latter is a very real risk.”
