Federal Reserve Takes Cautious Stand On Inflation, Powell Signals Preference For Rate Cuts Over Hikes - SPDR S&P 500 (ARCA:SPY), iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT)

Federal Reserve Chairman Jerome Powell indicated a cautious approach to monetary policy, suggesting interest rates may remain steady for a longer period. During a press conference, he mentioned that rate hikes are unlikely and cuts could be considered once inflation is confidently under control. This stance led to a drop in Treasury yields and a mixed reaction in the stock market, with the iShares 20+ Year Treasury Bond ETF and SPDR S&P 500 ETF experiencing slight movements.

Various analysts have different views on the future direction of interest rates. While Bank of America predicts a rate cut in December, Goldman Sachs expects two cuts later this year, citing Powell's dovish outlook on inflation. ING anticipates three cuts starting from September, and Citi projects rate reductions beginning as early as July, predicting a total of 100 basis points cut by year-end. These forecasts reflect a broad spectrum of expectations based on the Fed's current economic assessments and inflation projections.