As everyone and their pet rabbit hold their breath for tomorrow's CPI print, today saw small business optimism droop from multi-year highs, economic uncertainty jump, and CapEx expectations tumble.
Add to that Fed Chair Powell offering little new information during his 'Humphrey-Hawkins' testimony - reafffirming that the fed funds rate was "significantly less restrictive than it had been" and reiterated that the FOMC did "not need to be in a hurry to adjust our policy stance."
Additionally, Chair Powell tamped down Democrats' "tariff-tax threat" fearmongering, reiterating that “it would be unwise to speculate” on the economic impact of the new administration’s trade policies. Powell noted that it “remains to be seen what tariff policies are implemented,” and later stressed that their impact on the economy would “depend very much on specific facts about what’s being tariffed, for how long, etc.” He also reminded the Senate Committee that the FOMC “wound up cutting rates” in 2019.
