Bloomberg Surveillance

Instant Reaction: Jay Powell on the Fed Decision

4 snips
Jul 30, 2025
In this discussion, Jeff Rosenberg from BlackRock shares insights on market trends and monetary policy. He unpacks Jay Powell's recent statements on interest rates, revealing the Fed's cautious stance amidst economic uncertainties. The talks highlight mixed equity performances and the implications of tariffs and inflation on the economy. Rosenberg also explores challenges the Fed faces in addressing economic disparities, along with the evolving dynamics of long-term treasuries in investment strategies as the landscape shifts.
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INSIGHT

Powell's Cautious Rate Stance

  • Fed Chair Jerome Powell views the current interest rates as appropriate to manage inflation and tariff uncertainties.
  • He prefers to wait and watch due to many unresolved uncertainties rather than cutting rates soon.
INSIGHT

Labor Market Balance Explained

  • The labor market shows signs of a slowdown in labor demand but also a slowdown in labor supply due to immigration policies.
  • The unemployment rate remains stable, which tempers concerns about imminent weakening in employment.
INSIGHT

Tariff Shock Uncertainty

  • Today's tariff shock is more substantial than those in the 1930s due to higher import ratios.
  • The Fed is cautious because this tariff shock is uncharted economic territory with unknown inflation pass-through and investment effects.
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