Jerome Powell Says Equity Prices ‘Fairly Highly Valued,’ But Sees No Elevated Stability Risks
The Fed Chair made the remarks while speaking at an event in Providence, Rhode Island.
Federal Reserve Chair Jerome Powell said Tuesday that equity prices are “fairly highly valued,” while speaking at an event in Providence, Rhode Island.
“We do look at overall financial conditions, and we ask ourselves whether our policies are affecting financial conditions in a way that is what we’re trying to achieve,” Powell said in response to a question on how much emphasis the Fed places on market prices and whether it tolerates higher valuations. “But you’re right, by many measures, for example, equity prices are fairly highly valued.”
On mortgage rates, Powell added, “Markets listen to us and follow, and they make an estimation of where they think rates are going. And so they’ll price things in.”
Despite noting elevated equity valuations, Powell said this is “not a time of elevated financial stability risks.”
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