Australian Investment Blog

At 5am this morning, Janet Yellen - Chairwoman of the US Federal Reserve - gave the world some significant insight into the timing of interest rate rises in the US – note interest rate rise, not cuts. As anticipated, the Fed dropped the word “patient” from its policy statement, opening the door for a rate rise in June. However she added two very strong qualifying statements to ease market’s fears that led to a 227-point (1.27%) rally from the DOW.

1. The Fed said it won’t tighten until it is “reasonably confident” inflation will return to its target and the labour market improves further.2. The Fed also said “just because we removed the word patient from the statement doesn’t mean we are going to be impatient”.