BB: No Abrupt Change In Fed Intentions

Bloomerg headline: Fed to Plow Ahead on Half-Point Hikes, Undeterred by Stock Slump

Subheadlines: Central bankers view tighter financial conditions as helpful
‘Volatile days’ are not an issue for the Fed focused on prices

Don’t count on Federal Reserve Chair Jerome Powell to ride to the rescue of a faltering stock market – at least not yet.

Kansas City Fed President Esther George said Thursday that the market rout was no surprise in light of the central bank’s repeated caution that it will continue raising interest rates to cool the hottest inflation in decades. While she acknowledged equities were having a “rough” week, her remarks in a CNBC interview did nothing to soften the tone set by Powell on Tuesday, who warned that officials seek “clear and convincing” evidence that price pressures are retreating.

That’s not encouraging for investors betting on the imminent exercise of a “Fed put” – in which the central bank alters policy to prop up equity markets after a sharp decline.

Sounds like Anna is having a tough time having finding someone to mow her lawn, paint her house, or change her sheets at the Marriot Hotel where she’s enjoying a team building exercise with other 6-figure drones. Yes, this sounds callous.

“I think the Fed welcomes it. The stock market has to decline a lot more – double the current drop – before it will get close to wiping out the stock gains during the pandemic. This sounds callous, but declining stocks will get more people to come out of early retirement.”

–Anna Wong, chief U.S. economist