Powell's Panic-Relieving Presser Calms Hawkish Havoc But Yield Curve Crumbles

Hawkish havoc was unleashed briefly and then the man of steel stepped up...

The Initial Euphoric/Dysphoric reactions to Powell's rate-hike and hawkishness (Dollar spike, stocks down, yields higher, yield curve plunge, EM dump), but everything turned around during Powell's Presser.

In his presser, Powell reminded investors that despite the hawkish interpretation of today's meeting and his confident view of the economy, the economy is not yet overheating. Powell says "there is no sense in our forecasts'' that inflation will take off. "If we thought inflation would take off, we would be showing higher rates.''

Also, tomorrow's ECB meeting now looms and likely takes the shine off some positioning.

 

But by the close - stocks were back at the lows of the day.

Small Caps clung to unchanged from the FOMC statement, but the broader markets all retreated...

 

All major equity indices were lower on the day... knocked lower the China tariffs headline...

 

Tech and Financials exchanged roles after the Fed...

 

"Most Shorted" stocks were flat today but the following chart indicates just how insane a squeeze they have seen the last few weeks...

 

Yields were all higher on the day but well off their post-Fed highs...

 

10Y briefly tagged 3% then tumbled back to almost unchanged on the day...

 

The entire yield curve tumbled flatter...

 

The yield curve plunged to fresh cycle lows with 5s30s now within 1 rate hike of inversion...

 

The Dollar Index broke out intraday after the hawkish Fed from its recent extremely narrow range but quickly fell back to close red...

 

EM FX ended the day higher despite the chaos surrounding The Fed statement...

 

Cryptocurrencies had another awful day...

 

Silver surged as the dollar fell back during Powell's presser and WTI gained after s surprise crude draw reported by EIA...

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