Jerome Powell, Chairman of the Federal Reserve, recently discussed the topic of interest rates and inflation, cautioning against premature aggressive rate cuts. He suggested keeping policy restrictive until there’s certainty that inflation is on a clear path back to the 2% target set by the Federal Open Market Committee (FOMC).
Even though current policy remains restrictive, Powell highlighted a balance between combating inflation and preventing economic slowdown. His comments had a positive impact on markets, with stocks climbing on Wall Street and Treasury yields dropping sharply.
The rise of interest rates by the Federal Reserve in response to high inflation significantly influenced economic activity and inflation levels. Powell mentioned that while these policies have had an impact, their effects might not have been fully realized yet.
Market expectations indicate a belief that the Fed has concluded raising rates and might start cutting them as early as March 2024. However, Powell and other Fed officials highlighted the importance of making decisions based on incoming data, refraining from committing to a specific course.
Another interesting news is that Pfizer’s twice-daily weight loss pill has joined numerous other failed attempts to combat obesity with pharmaceutical solutions. The company decided to halt the development of Danuglipron due to high rates of adverse side effects during a mid stage clinical trial. Despite this setback, Pfizer intends to release data on a once-daily version of the pill for further assessment.
With this new pill, Pfizer will underscore the challenges of creating effective, safe, and well-tolerated weight loss treatments. This new product will provide a valid alternative to recent breakthrough medications such as Novo Nordisk’s Wegovy and Eli Lilly’s Mounjaro, which have gained popularity for their ability to induce weight loss safely.
Author: Simona Merlo