Fed Has to Regain The Market’s Confidence

Traders are starting to doubt the U.S. Federal Reserve (Fed)’s command of monetary policy, according to Societe Generale’s famously pessimistic strategist, Albert Edwards.

There is “increasing evidence of a loss of confidence that the Fed is actually in control”, after its rate-setting committee, led by Chair Janet Yellen, seemed to brush aside concerns about deflation by choosing not to raise interest rates at its September meeting, Edwards argued in a research note.

Yellen cited concerns about instability elsewhere in the world when she spoke about her decision. The Fed has since been criticized for assigning too much importance to market turmoil elsewhere, rather than focusing on the U.S. domestic economy, when making its call. There have also been concerns that uncertainty of when rate rises will happen is now more of a drag on stock markets than a small rate rise, which has been long expected, would be.

via CNBC

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.