Fed Apology, Strong Job Growth Bolster Stocks
The better than expected jobs data followed a press conference on Wednesday by Federal Reserve chairman, Jerome Powell, in which he clarified his recent reversal of Fed monetary policy. On January 4th, Mr. Powell first said the Fed would hold off on further rate hikes, a sharp change from the Fed's policy.
On January 5th, 2018 (in black), the one-month U.S Treasury Bill yielded 1.39% versus the 2.41% on January 31st, 2019 (in red) — the current rate. The economy has been strong, and the Fed has been able to raise rates without causing a slowdown, but its plan to raise rates in 2019 to 3% would invert the yield.
The Fed chief first announced a change in policy on January 4th in Atlanta, and then went into greater detail at Wednesday's press conference.
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