No tightening under Powell

In addition to optimism about the economy and inflation in the United States, Jerome Powell, as the new Federal Reserve chairman, has emphasized that the volatility in the financial markets will not mean a change in the Fed's tightening policy.

This is the conclusion drawn by Michael Metcalfe, head of macro strategy, and portfolio manager Sophia Ferguson for fixed-income securities and currencies at State Street Global Advisors after the statement that Powell issued on Tuesday.

On Tuesday from 4 pm Powell is still heard and market researchers expect much more reaction. There he reported that inflation remains below 2% and small interest rate steps are needed.

In a first reaction the yield on the ten-year interest rate went to 2.868%, the euro was 0.4% lower against the dollar at $ 1.2266.

According to Metcalf and Ferguson, Powell, as the successor of Janet Yellen, acknowledged a year earlier, just like with a similar speech, that the policy of the central banks is on track for the promised three rate hikes this year.

The market is looking explicitly for the smallest reasons whether a fourth interest rate step will be needed.

There is no reason to expect more interest rate steps. 'So far, there is' no indication 'that Powell leans to one side or the other- more or less monetary interventions- according to State Street.

'Although it is clear that economic conditions have improved, Powell's comments were consistent with the Federal Reserve,' they argue.

The Fed can nevertheless intervene quickly. The institute does, however, take the position to respond quickly to changes in macroeconomic data about the American economy.