Powell's comments did little to sway investors in futures markets tied to the Fed’s policy rate, which on Wednesday reflected bets for only one additional rate increase this year, followed by cuts in January.
An inverted yield curve occurs when yields on shorter-dated Treasuries rise above those for longer-term ones.
It suggests that while investors expect interest rates to rise in the near term, they believe higher borrowing costs will eventually hurt the economy, forcing the Fed to later ease monetary policy.
"With a steeply inverted curve we see a lot of yield and a lot of attractive opportunities in the front end," said Steve Hooker, portfolio manager of Newfleet Asset Management.
Greg Peters, co-chief investment officer of PGIM Fixed Income, said inflation remained way too high to anticipate rate cuts any time soon.
Persons:
Jerome Powell hasn't, Powell, Powell's, Roger Hallam, Steve Hooker, ” Hooker, Greg Peters, We're, Davide Barbuscia, Ira Iosebashvili, Leslie Adler
Organizations:
YORK, Federal, Fed, Vanguard, Silicon Valley Bank, Commonwealth Financial Network, Newfleet Asset Management, Thomson
Locations:
Silicon, U.S