‘Statement of confidence’: Powell says bond markets validate Fed stance amid inflation fears

Federal Reserve Chairman Jerome Powell said on Tuesday that rising Treasury yields were a sign of confidence in the economic recovery, downplaying the risks of inflation as the central bank pursues monetary policies meant to foster a faster rebound.

Treasury yields have approached and, in some cases, broken record highs in recent days as investors see evidence of a fast-paced recovery coupled with an incoming $1.9 trillion relief bill, which some have cautioned will generate sharp increases in inflation.

“It’s very important to ask why are rates moving up,” Powell told the Senate Banking Committee. “And so if you look at why rates are moving
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