(CercleFinance.com) – Wall Street should open higher on Wednesday morning, reassured by the latest statements from the chairman of the Federal Reserve on the question of the timetable for a reduction in interest rates.
Half an hour before the opening, ‘futures’ contracts on the main New York indices advanced between 0.4% and 0.8%, suggesting a green start to the session.
In a text released ahead of his hearing before the Financial Services Committee of the House of Representatives, Jerome Powell judged that it seemed appropriate to ease the Fed’s monetary policy ‘at some point’ this year.
In his speech, the head of the central bank reiterates his cautious approach, highlighting an ‘uncertain’ economic situation and the lack of assurance regarding an imminent return of inflation towards the 2% target.
According to Powell, too rapid or too much monetary easing could risk erasing recent progress made in reducing inflationary pressures.
Conversely, he emphasizes, insufficient or late support could unfairly penalize economic activity and employment, he argues in his speech.
These comments reassured investors by reinforcing general market sentiment, which favors measured growth and inflation allowing for an upcoming normalization of the Fed’s monetary policy.
The publication before the opening of employment figures showing a lower than expected number of job creations in the private sector last month did not chill investors, on the contrary.
According to ADP, the private sector in the United States generated 140,000 new jobs in February, while the consensus expected more than 160,000.
Still on the indicators side, investors are now waiting for stocks from wholesalers, then oil reserves which could cause oil prices to react.
For the moment, a barrel of light Texas crude (WTI) is advancing 1.5% to $79.3 in a climate of risk appetite due to the reassuring words of Jerome Powell.
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