NAB – The Morning Call · Powell wants time to heal

Powell wants time to heal

Monday 25th October 2021

Comments from Jerome Powell added to the volatility in bond markets on Friday. The chair of the Fed reinforced that it was time to taper, but suggested rate rises would have to wait, with more than five million people who were working before the pandemic still unemployed. The labour market needs time to heal, he said. NAB’s Ray Attrill says it shows that he is less inclined to respond to inflation worries until bond purchases are unwound, unlike the Bank of England. Ray also points out how the PMI data for Europe, the UK and US was generally strong, suggesting that stagflation looks like likely. It’s a busy week ahead with the ECB and Bank of Canada meeting, Q3 CPI for Australia and lots of earnings announcements, including Facebook after Monday’s close in the US.

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