Federal Reserve Chairman Jerome Powell shored up rate cut hopes with his testimony before the Senate Banking Committee Thursday and House Financial Services Committee Wednesday.
The Dow(INDU) rose to a fresh all-time intraday high before pulling back slightly. It is up 0.4% or 111 points.
The S&P 500(SPX) is up a modest 0.1%.The S&P 500 is on track to climb to a fresh all-time high on Thursday, having ended just some three points below the record it set on July 3. The Nasdaq Composite(COMP), which closed at a new all-time high of 8,203 points on Wednesday, slipped into negative territory.
The market shrugged off slightly higher-than-expected consumer price data, released earlier. Inflation rose 1.6% year-over-year in June, as expected, but core inflation rose slightly to 2.1%, versus the expected 2%. Rising inflation doesn’t bode well for the interest rate cut the market is hoping for.
Expectations for a quarter-percentage-point cut at the Fed’s July 31 meeting are 80%, with the remaining 20% hoping for a 50 basis point decrease, according to the CME’s FedWatch tool.
In remarks before the House on Wednesday, Powell noted that inflation continued to be below the central bank’s 2% target.