Fed's Daly Says If There Are Gradual Declines In Inflation, Slow Labor Market Rebalancing, Then Fed Can Normalize Policy Over Time; Must Fully Restore Price Stability Without A Painful Disruption To The Economy; Bumpiness Of Inflation Data So Far This Year Has Not Inspired Confidence; Recent Inflation Readings More Encouraging, But Hard To Know If On Track To Sustainable Price Stability; Restrained Demand, Not Improved Supply, Likely Needed To Get Inflation To 2% Goal
Portfolio Pulse from Benzinga Newsdesk
Fed's Daly suggests that if inflation gradually declines and the labor market rebalances slowly, the Fed can normalize policy over time. The goal is to restore price stability without causing economic disruption. Recent inflation data is more encouraging, but it's uncertain if sustainable price stability is achievable. Restrained demand, rather than improved supply, is likely needed to reach the 2% inflation goal.
June 24, 2024 | 6:02 pm
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POSITIVE IMPACT
Fed's Daly indicates that gradual declines in inflation and slow labor market rebalancing could allow the Fed to normalize policy over time. This suggests a potential stabilization in the economic outlook, which could positively impact SPY.
The potential for policy normalization and a more stable economic outlook could boost investor confidence in SPY, leading to a positive short-term impact on its price.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 80