Fed's Mester Says If Sustained, Higher Bond Yields Will Help Moderate Economic Activity; Fed Needs To Be 'Nimble' With Monetary Policy Right Now; Inflation Cooling But Still Too High, Risks Tilted To Upside
Portfolio Pulse from Benzinga Newsdesk
Federal Reserve's Loretta Mester stated that if the higher bond yields are sustained, they will help moderate economic activity. She also emphasized that the Fed needs to be 'nimble' with its monetary policy at present. Mester noted that inflation is cooling but is still too high, with risks tilted to the upside.
October 20, 2023 | 4:19 pm
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NEGATIVE IMPACT
The comments from Fed's Mester about higher bond yields and the need for nimble monetary policy could impact the SPY ETF, which tracks the S&P 500. Higher bond yields can make equities less attractive, potentially affecting SPY.
Higher bond yields can make equities less attractive as they offer a safer return. This could lead to a shift from equities to bonds, potentially affecting the SPY ETF which tracks the S&P 500. Furthermore, the mention of a 'nimble' monetary policy suggests potential changes in the Fed's approach, which could introduce uncertainty in the market, potentially negatively impacting SPY.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 50