Fed's Bowman Says 'Will Likely Be Appropriate' To Raise Rates Further And Hold Them At Restrictive Level For Some Time; Inflation Remains Too High; Sees Risk That High Energy Prices Could Reverse Some Of The Recent Progress On Lowering Inflation
Portfolio Pulse from Benzinga Newsdesk
Federal Reserve's Michelle Bowman stated that it 'will likely be appropriate' to raise interest rates further and maintain them at a restrictive level for some time due to persistently high inflation. She also expressed concerns that high energy prices could reverse some of the recent progress on lowering inflation.
October 02, 2023 | 2:31 pm
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NEGATIVE IMPACT
The Federal Reserve's potential decision to raise interest rates could negatively impact the SPY ETF. Higher interest rates generally lead to lower stock prices as borrowing costs increase for companies.
The SPY ETF tracks the S&P 500, which is a broad representation of the US stock market. Higher interest rates increase borrowing costs for companies, which can lead to lower profits and thus lower stock prices. Therefore, the potential decision by the Federal Reserve to raise interest rates could negatively impact the SPY ETF.
CONFIDENCE 70
IMPORTANCE 80
RELEVANCE 50