Powell Says the Fed Has Time to Assess Data Before Deciding to Cut – US Market Wrap

The bond market recovered from session lows, with Jerome Powell reiterating the Federal Reserve’s wait-and-see approach before deciding whether to cut interest rates.

While the Fed chief did not break any new ground, Wall Street was relieved by his assertion that recent inflation figures did not “materially change” the overall picture. Powell also stated that it will most likely be appropriate to begin lowering rates “at some point this year.” Equities edged higher after a two-day slide, but struggled to gain traction amid a drop in two blue chips, Intel and Walt Disney.

In recent days, traders have reduced their expectations for rate cuts, citing signs of economic resilience and a more cautious tone from Fed officials. This has raised questions about Powell and his colleagues’ ability to deliver on the central bank’s projection of three rate cuts this year.

Treasury 10-year yields were little changed at 4.35%, having risen about eight basis points earlier Wednesday. The S&P 500 finished with a mere 0.1% gain. Intel provided a disappointing outlook for its factory operations, while Disney rejected dissident investor Nelson Peltz’s bid for a board seat at the massive entertainment conglomerate.