Powell Presser—My Takeaways
Status quo
FOMC decision held with broad support. Waller and Miran dissented for a cut—they lost.
Powell says policy isn’t significantly restrictive anymore. Called it “loosely neutral or somewhat restrictive.”
Labor
Job gains low but stabilizing. Labor supply growth stopped. GDP-labor disconnect might be productivity gains. Job availability softening.
Inflation
Core PCE ex-tariff effects just above 2%—Powell called that “healthy.” Tariff impact expected to peak mid-year then fade. Short-term expectations fully retraced. Won’t declare victory.
Next Move
No roadmap. Any data combination could trigger action. Labor risks resurface; they move. Inflation stays elevated, they hold. To me, it suggests that rate cuts may be off the table for some time given the patient tone and improved growth outlook.
Other
Economy surprising with strength. Fiscal deficit unsustainable. Productivity may explain growth/labor gap. Possible AI-college grad hiring connection. Spending strong despite downbeat surveys.
Fed Independence
Hasn’t been lost, won’t be. Hard to restore if lost. Advice for successor: stay out of politics. Attended Cook case—most important legal case in Fed history.
Bottom Line
Patient tone. Growth better than December. Labor stabilizing. Inflation tariff-driven and temporary. Current stance works.
Market Reaction
Status quo policy means existing trends continue. Dollar, rates, gold—all tracking their established directions. Powell’s patient message didn’t disrupt momentum in either direction. Markets keep running with what they were already doing.