Bloomberg Surveillance Instant Reaction: Jay Powell on the Fed Decision
21 snips
Dec 10, 2025 
In this insightful discussion, guests Stephanie Roth, an analyst at Wolfe Research, and Aditya Bahave, a Bank of America economist, dive into the implications of the recent Fed policy decisions on productivity and GDP revisions. Roth tackles the impact of higher productivity linked to AI, while Bahave shares forecasts about GDP and unemployment. BlackRock strategist Jeff Rosenberg adds depth by examining market reactions and balance-sheet operations. Together, they explore how these factors shape the economic landscape and what it might mean for future Fed actions.
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Productivity Could Enable Goldilocks Growth
- Jay Powell flagged higher productivity (partly from AI) as allowing growth without more job creation.
- That suggests inflation can stay in check while GDP expands, enabling a Goldilocks outcome.
Fed To Buy Bills To Alleviate Money Market Strain
- The Fed will buy $40 billion of T-bills to ease near-term money market stress.
- Officials said purchases may remain elevated for a few months before declining with market conditions.
Productivity Plus 'QE Light' Tilted Markets Dovish
- The meeting combined productivity optimism with QE-like bill buying, producing a dovish market reaction.
- Markets treated the technical balance-sheet move as easing, pushing yields lower and stocks higher.