Wall St. jumps after jobs report, Powell comments

Wall St. jumps after jobs report, Powell comments

Federal Reserve Chairman Jerome Powell on the state of the USA economy, the December jobs report and the ISM report on manufacturing.

DXY's up move to the 96.60 region, or session highs, is now an ephemeral memory as a effect of the dovish tone from Chief Powell's speech at the annual meeting of the American Economic Association.

The Dow and S&P 500 were up 3.4% at mid-day, while the Nasdaq climbed 4.2%.

Wall Street stocks were in rally mode on Friday morning (Jan 4) following strong USA jobs data and after the Federal Reserve head acknowledged rising investor angst over global growth.

The Federal Reserve raised interest rates in December for the seventh time since Trump took office, four of which happened under Powell, and has signaled that it would consider raising rates again in 2019.

At the conference on Friday, Mr Powell said he has not spoken directly to Mr Trump and would not resign if asked.

More news: The Captain & Tennille’s Daryl Dragon Dead at 76

He also defended the Fed's rate rises, pointing to strong economic data that suggest businesses and households can handle the higher costs.

Jerome Powell, chairman of the Fed said: "Markets are expressing concerns about global growth in particular, that's becoming the main focus and trade negotiations which are related to that".

USA employers hired the most workers in 10 months and wages accelerated at a robust pace in December, suggesting the economy would avoid a sharp slowdown.

"Patience is the right approach", when the Fed is getting conflicting signals from the hard data, which is backward-looking, and the financial markets, which are looking ahead to downside risks, said Kohn, now a senior fellow at the Brookings Institution in Washington.

There is "no pre-set path for policy and particularly with the muted inflation themes coming in we will be patient as we see how the economy evolves", Mr Powell said. "We are always prepared to shift the stance of policy and to shift it significantly" if needed.

But, he said, "If we reached a different conclusion we wouldn't hesitate to make a change". Fed watchers have said that the bar is very high for the president to remove Powell "for cause" as the law appears to require, provided Powell decides to fight the dismissal in court.

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