Fed Chair Powell Says Government Shutdowns Don't Traditionally Have Much Of A Macro Effect; Higher Energy Prices, When Sustained, Can Affect Inflation
Portfolio Pulse from Benzinga Newsdesk
Federal Reserve Chair Jerome Powell stated that government shutdowns typically do not have a significant macroeconomic effect. However, he noted that sustained higher energy prices can impact inflation.
September 20, 2023 | 7:03 pm
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The SPY ETF, which tracks the S&P 500, could be affected by these comments. Higher inflation could lead to increased interest rates, potentially negatively impacting stock prices.
The SPY ETF tracks the S&P 500, a broad measure of the US stock market. If inflation rises due to sustained higher energy prices, the Federal Reserve may raise interest rates to combat this. Higher interest rates can make borrowing more expensive for companies, potentially leading to lower corporate profits and lower stock prices. Therefore, the SPY ETF could be negatively impacted.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 75