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Daily Trends Now


Global stocks soar on dovish Fed, strong US jobs data

Global stocks soar on dovish Fed, strong US jobs data

"We will be patient as we watch to see how the economy evolves", Powell said.

The Fed, which hiked benchmark US interest rates four times past year including in December, is however not on a preset path and could pause policy tightening as it did in 2016 when global growth concerns led to doubts about the USA economic recovery, he said.

The December job report also indicated that unemployment rate was up 0.2 percentage point month-on-month to 3.9 percent, and that average hourly earnings for all employees on private nonfarm payrolls rose 11 cents, or 0.4 percent over November, to 27.48 US dollars.

Futures traders on Friday were pricing in a small chance of a rate hike this year, versus no chance seen before Powell began speaking. Most of the companies in those industries stand to do better in times of faster economic growth.

That robust figure, however, will not as of now change the Fed's plan to conduct two rate hikes this year, as the central bank awaits more economic indicators coming in the next few months.

Stocks opened the day higher after the Labor Department reported that nonfarm payrolls in the United States increased in December by 312,000, well above consensus estimates of 177,000 jobs created.

Overall, she said she felt the Fed was in a "really good spot".

"We don't expect that this will be the end to the volatility", she said.




The head of the Fed, once confirmed by the Senate, can only be removed "for cause", not a policy disagreement. The president has vented about the Fed in tweets and interviews, and Bloomberg News reported December 21 that he'd discussed firing Powell over his frustration with rate hikes. Asked on Friday whether he would resign if Trump requested it, Powell said: "No", adding there were no meetings scheduled between the two men.

A report Friday from JPMorgan Chase said trends in financial markets suggest investors have priced in around a 60 percent chance of a recession, while economists have put the odds of a recession within one year at around 40 percent.

The dollar strengthened. It rose to 108.51 yen from 107.77 yen.

Speaking after months of volatility in world financial markets, and just hours after a monthly jobs report suggested the USA economy remained robust, Powell's soothing comments initially pushed stock indexes higher.

Hopes for progress in the U.S. "There aren't signs of significant economic weakness". A third Fed president, Thomas Barkin of Richmond, said he is hearing more concerns about economic risks and trade. "We're hearing a lot from different groups of people about the role the balance sheet normalization may be playing in the market", Powell said.

Mr Powell said that he did not believe the Fed's removal of stimulus by shrinking holdings of Treasuries and mortgage-backed securities played a major role in the recent market turmoil.

"Markets are expressing concerns about global growth in particular and trade negotiations", Powell said. Articles appear on euronews.com for a limited time.

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