Markets Year-to-Date: DJIA: +14.93%/ S&P 500: +18.5%/ Nasdaq: +23.99%
Data Dump: Consumer confidence is up (+5 points), businesses are hiring, wages are moderately increasing (+2.9%), and unemployment has decreased to 3.6%.
Blurred Lines. The Federal Reserve met on Wednesday and decided not to make a change to their interest rate target (target remains at 2.25% to 2.50%). This sent the markets in to a tailspin with the S&P ending the day down -0.75%. Blame it on poor communication. The Feds statement after the meeting seemed to indicate the possibility of a rate cut as core inflation has declined and is now running below 2%. However, in Chairman Jerome Powell’s post-meeting press conference, he repeatedly stated that “the decline in core inflation is due to ‘transient’ factors”. Essentially, he does not see the decline in inflation continuing which supports his wait and see attitude towards interest rate changes.
The Fed’s job, and it’s autonomy, has not been made easy by President Trump, who continues to politicize monetary policy.