Federal Reserve Chairman Jerome Powell testified in front of the Senate Banking Committee this week, and while his comments didn’t stray far from the usual script, markets were spooked by his steadfast commitment to fighting inflation with interest rate hikes.
“The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated,” he told senators, referencing January’s strong jobs report and signs of resilient consumer spending. The S&P 500 dropped 1.5% after Powell spoke, and has struggled through the week.
