Powell’s Testimony Contains no Surprises

Having just completed the Senate portion of this week’s Congressional testimony, Fed Chairman Jerome Powell’s remarks offered much the same content as his recent post-FOMC meeting press conference. Mr. Powell reaffirmed the Bank’s intent to continue to provide support to the economy as needed. Most investors probably heard what they wanted to; the Fed continues to have your back. He also reaffirmed the Fed’s continuation of its support of corporate debt issuers by saying “If market function continues to improve, then the Fed will slow ts corporate bond buying program.” Is it telling that Mr. Powell’s future actions are described as being based upon market function rather than economic performance?

The DJIA ralled during the duration of Mr. Powell’s testimony and is up over 600 points at the moment. The prospect of a $1T infrastructure plan has also produced some market buzz. The Ten-Year still languishes around 75 basis points.