Jerome Powell Threatens to Trigger a Stock Market Crash on April 3

Source: Domenico Fornas /

Federal Reserve Chairman Jerome Powell has another speech coming up this Wednesday, April 3. Just days after suggesting rate cuts might not come until later in the year, Powell is back on the podium ahead of crucial March jobs data due this Friday.

What should you expect this time?

Well, if history is any indicator, probably more of the same. In fact, Powell has generally shown a fairly neutral demeanor this year, maintaining expectations of future rate cuts while admitting that the state of the economy justifies keeping rates high for longer.

Last week, Powell affirmed expectations that the central bank will cut rates, but rejected notions that the Fed is comfortable with inflation where it is.

“No, that doesn't mean that.” Powell said.. "We marked our growth forecast, like many other forecasters, so the economy is doing well and the inflation data was a little bit higher as a separate issue and I think that caused people to write down their inflation forecast." . [projections].”

Consumer prices rose 2.5% in February, according to the Federal Reserve's preferred Personal Consumption Expenditures (PCE) report released last week. This was slightly higher than January's 2.4% inflation reading, suggesting that the final stretch of the war on inflation may be more difficult than investors expected.

Jerome Powell May Weigh on Stocks as Stocks Fall

So far, stock markets have responded poorly to Powell's remarks last week. In fact, most of the major indices have fallen in the first two trading sessions of the new week, the first days of the second quarter.

He S&P 500 and Nasdaq Composite They have lost 1% and 1.3%, respectively, so far this week. Depending on the tone Jerome Powell takes tomorrow, it could help stem losses or lead to continued bearish sentiment going forward.

"We are firmly committed to reducing inflation to 2% over time," Powell added. "The markets believe we will achieve that goal and they should believe it because that is what will happen over time."

On the date of publication, Shrey Dua did not hold (either directly or indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to Publication Guidelines.

With a degree in economics and journalism, Shrey Dua leverages his extensive media and reporting experience to contribute well-informed articles covering everything from financial regulation and the electric vehicle industry to the real estate market and monetary policy. Shrey's articles have appeared in publications such as Morning Brew, Real Clear Markets, Downline Podcast, and more.

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