S&P 500 passes historic mark of 4,500 points after US Fed Chair Powell’s speech
Major US stock indices have hit record highs following statements by Federal Reserve Chairman Jerome Powell regarding monetary policy.
The NASDAQ index reached an all-time high of 15,129 points in Friday trading. The S&P 500 broad market index rose 0.88% to 4,509 points, breaking the 4,500 mark for the first time in history. The Dow Jones Industrial Average (DJIA) also grew by 0.69% – up to 35,455 points.
Also on rt.com US sees biggest inflation surge in 30 yrs, with consumer prices rising 5.4%The stock market rally came in response to statements on monetary policy made on Friday by Federal Reserve Chairman Jerome Powell at an economic policy symposium in Jackson Hole. Powell said the Fed considers the current sharp rise in inflation to be temporary, and therefore does not plan to raise rates.
“For now, I believe that [monetary] policy is well positioned… the baseline outlook is for continued progress toward maximum employment, with inflation returning to levels consistent with our goal of inflation averaging 2% over time,” he stated, noting that the Fed will continue to monitor incoming inflation data before taking any steps regarding monetary policy. Powell also said the Federal Reserve may cut measures to support post-pandemic economic recovery later this year, though he did not specify the exact timeframe for this. The measures include the purchase of state treasury bonds, which allows the cost of borrowing to be kept low and stimulates the growth of expenses of businesses and consumers, while, on the downside, also accelerating inflation.
Also on rt.com Weaker dollar pushes oil higher after seven days of declines“We would continue our asset purchases at the current pace until we see substantial further progress toward our maximum employment and price stability goals… My view is that the ‘substantial further progress’ test has been met for inflation. [In July] I was of the view that if the economy evolved broadly as anticipated, it could be appropriate to start reducing the pace of asset purchases this year. The intervening month has brought more progress,” Powell stated, adding that even after the asset purchases end, “elevated holdings of longer-term securities will continue to support” the US economy.
Meanwhile, the Russian ruble increased its growth after Powell’s statements. The dollar fell against the Russian currency to 73.63 rubles, dropping 51 kopecks, 2.5 times more than the previous day, while the euro dropped to 86.86 rubles, losing 33 kopecks, three times more than the day before, according to data from the Moscow Exchange.
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