On Wednesday, November 30th at 1:30 PM ET, Fed's Powell delivered a speech to the Brookings Institute in Washington.
Here are some of the highlights
In the text release, Powell stated that "the time to slow the pace of rate hikes could come as soon as the December meeting," and that it makes sense to moderate the pace of interest rate increases.
He repeated that policy will most likely need to remain restrictive for some time, and also repeated that it seems that rates need to ultimately go somewhat higher than policymakers thought in September.
"October inflation data was a welcome surprise, but it will require much more evidence to give reassurance that inflation is actually dropping."
Following the text release from Fed's Powell at 1:30 PM ET, we saw the dollar weaken, S&P 500 strengthen, and yields on the US 10-year weaken.
After this, Fed swaps show paring of the expected terminal rate to around 5.02%, and Fed policy rate futures implied a 75% chance of a half-point rate hike in December, versus a 25% chance of a 75-basis point hike.
In the Q&A section, Powell went on to say that wage increases are now being offset by inflation for the majority of workers and that the Fed has been able to look through supply disruptions in the past, but it is unclear whether this will continue.
He reiterated that slowing down at this point is a good way to balance risks.
"I still think there is a path to a soft or softish landing, without a severe recession."
He stated that he doesn't want to overtighten, and cutting rates is not something I intend to do anytime soon.
As the Q&A went on, we saw gains in the S&P 500 continue, ending the event up some 1.7% after being negative earlier in the session, the dollar also extended its losses.