Bonds & Stocks
US stocks fell and Treasuries advanced as investors rushed to haven assets ahead of Federal Reserve Chair Jerome Powell’s testimony to Congress where he’s expected to reiterate his commitment to curb inflation, adding to fears that the central bank’s aggressive path of interest rate hikes could tip the economy into a recession.
Economy
Federal Reserve Chair Jerome Powell said the central bank will keep raising interest rates to tame inflation following the steepest hike in almost three decades, though policy makers must be “nimble” as various shocks buffet the world’s largest economy. “We anticipate that ongoing rate increases will be appropriate,” Powell said Wednesday in the text of his semiannual testimony to the Senate Banking Committee.
World
A world economy already contending with raging inflation, stock-market turmoil and a grueling war is facing yet another threat: the unraveling of a massive housing boom. As central banks around the globe rapidly increase interest rates, soaring borrowing costs mean people who were already stretching to buy property are finally reaching their limits. The effects are being seen in countries such asCanada, the US and New Zealand, where once-hot residential real estate markets have suddenly turned cold.