Federal Reserve Chairman Jerome Powell appeared on 60 Minutes to discuss monetary policy and the recovering economy.
Reading between the lines, we can see softening language and specific references to the level of inflation that could trigger future policy changes.
With signs of inflation starting to manifest, this interview validated speculation that rates will rise ahead of schedule.
A recent survey by Bloomberg revealed that economists expect the Fed to taper its bond purchasing activity in the fourth quarter of this year.
We shouldn’t read too much into that annual growth figure because March 2020 was deeply disrupted by the pandemic, and gasoline prices are substantially higher this year, but this is still important information.
Investment and corporate banking activity were bright spots, so these bellwethers are painting a reassuring picture of economic activity.
Manufacturing PMI for the US reached its highest level since the 1980s, and the newer Services PMI metric hit an all-time high.
The appliance manufacturer also absorbed double-digit price increases for raw material and transportation, and it was able to pass them on to the consumer.
Keep these dynamics in mind as you manage your long-term investment portfolio through the next few months.