- Stocks rose to their highest level since May 2020, while treasury yields fell, as Federal Reserve Chair Jerome Powell allayed fears that the central bank would accelerate rate hikes after delivering the largest rate hike in two decades.
- After Powell stated that "a broad sense on the committee" that "further 50 basis-point hikes should be on the table for the next couple of meetings," traders reduced their bets on a larger June boost. He also debunked rumours that the Fed was considering a 75-basis-point rate hike in the coming months, noting that it is "not something that the committee is actively considering." The dollar has dropped the most in two months.
- The Federal Open Market Committee unanimously decided to raise the benchmark rate by half a percentage point. It will begin allowing its Treasury and mortgage-backed securities holdings to decrease in June at a combined monthly rate of $47.5 billion, gradually increasing to $95 billion over three months.
- Before the Fed's decision, Jamie Dimon, the CEO of JPMorgan Chase, argued the US central bank should have hiked rates sooner as global price pressures hit. As the Federal Reserve works to reduce inflation, Treasury Secretary Janet Yellen anticipates a possible "soft landing." “I do believe we’re going to see solid growth in the coming year,” she said in an interview at a Wall Street Journal event on Wednesday.
