Summary of Key Points from Powell's Speech on April 16

Wallstreetcn
2025.04.16 18:31

  1. Federal Reserve Chairman Jerome Powell hardly mentioned the FOMC's monetary policy outlook, stating that the FOMC is ready and is waiting for more certainty regarding U.S. President Trump's tariff policy.

  2. Without price stability, a strong labor market cannot be achieved. Forecasts indicate that March PCE inflation will rise to 2.3%, with the core inflation rate at 2.6%.

  3. The labor market appears to be solid and generally balanced. It is unclear how extensive the layoffs at Musk's Department of Efficiency (DOGE) will be.

There is currently no (balancing) conflict between the two policy goals of full employment and price stability.

  1. Even in the most optimistic scenario for the FOMC, President Trump's tariffs exceed expectations.

  2. A regulatory framework for stablecoins is needed. It is expected that there will be a relaxation of regulations on the banking industry regarding cryptocurrency issues.

  3. The capital status of the banking system is good and quite resilient. Certain small and medium-sized banking institutions have a high concentration in commercial real estate (CRE). In my personal opinion, the U.S. should complete the implementation of Basel III.

  4. The independence of the Federal Reserve is granted by U.S. law. The (Trump administration) cannot dismiss Federal Reserve officials without reason. It is feared that the U.S. Supreme Court's ruling (catering to Trump's layoffs) does not apply to the Federal Reserve

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