Wall Street Sees 'Devil's Bargain' in Powell's Rate Comments
Comment of the Day

November 02 2022

Commentary by Eoin Treacy

Wall Street Sees 'Devil's Bargain' in Powell's Rate Comments

This article from Bloomberg may be of interest to subscribers. Here is a section:

“This is a devil’s bargain,” said Steve Chiavarone, senior portfolio manager at Federated Hermes. “Size of rate hikes will likely fall, but terminal rate is likely higher -- the implication is a greater number of smaller rate hikes. That is not dovish.” 

Eoin Treacy's view

Jay Powell said in plain English it is better to overtighten, and cut later, than to under tighten and risk allowing inflation to become entrenched. That’s about as hawkish as it gets. The Fed wants a recession and they will keep going until they kill demand.

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