Federal Reserve chair Jerome Powell has made clear over several public appearances in the last week that it’s unlikely the central bank cuts interest rates in March.
But stock market bulls aren’t worried about the shift back in rate cut expectations. And that has more to do with what Powell has been saying about strong economic data.
The Fed chair noted that a strong labor market and economic growth are no longer chief concerns for the Fed in when it will cut rates.
“We’re not looking for a weaker labor market,” Powell said on Jan. 31. “We’re looking for inflation to continue to come down, as it has been coming down for the last six months.”
In other words, good economic news should no longer be perceived as “bad” just because it could mean another Fed interest rate hike is coming. Instead, good economic news is simply good news for the stock market because it means business activity is picking up. And in the long run, that’s…
