According to ChainCatcher, Federal Reserve Chairman Powell stated on Wednesday that market expectations of the Fed intervening to calm volatility may be incorrect. When asked whether the Fed would intervene to address the sharp stock market decline, Powell said: "My answer is no, but I will explain." Powell, who was attending a meeting in Chicago, said: "I believe the market is digesting the current situation, and the market is responding to a great deal of uncertainty, which implies volatility."
Powell said it was understandable that markets would face difficulties given the massive changes in President Trump's tariff system. He also explained that it is difficult to know in real-time what is causing the trouble. Powell stated: "I have experienced many significant market fluctuations, such as in the bond market. Usually, people form an idea, and when they look back two months later, they find that their initial view was completely wrong. Therefore, it is too early to determine what is happening in the market right now." At present, he pointed out that market turbulence is partly due to hedge funds reducing leverage or debt, and added: "In the short term, you may continue to see market volatility."
