NEW YORK (Pakistan Point News / Sputnik - 26th March, 2022) Financial markets in the United States have continued operating with minimal disruption despite this year's explosive events, which include the Russia-Ukraine crisis and runaway US inflation, New York Federal Reserve President John Williams said Friday.
"We have seen a significant shift in the global policy stance," Williams told a live-streamed event, referring to the many central banks, including the Fed, that have moved to act against inflation with a decisive tightening in monetary policy. Despite such action, "overall, financial markets have modified expectations with little disruption," Williams noted.
The New York Fed chief's comments came as the US stock market headed for a second strong week of gains and, potentially, the first month in the black in March � after back-to-back losses in January and February on concerns about rate hikes and the war in Ukraine, respectively.
In Friday's trade, Wall Street's S&P 500 index, which groups the top 500 US stocks, was up 1.4% on the week after the previous week's 6% gain. The index was also headed for a 3.5% rise in March, after losses of 3.1% and 5.3% in January and February, respectively. For the year though, it remains down 5%.
The New York Stock Exchange has also not seen any disruption in operation since the early COVID-19 days of March 2020, when trading was halted for many days. Wall Street's circuit breakers typically go off, disrupting trading, when an index such as the S&P 500 drops 7%, 13%, and 20% from the close of the previous day.
In contrast to the US market, the London Metal Exchange suspended trading in nickel for a week until March 16 after wild daily swings of as much as 40% in the price of the stainless-steel and battery-making commodity produced largely in Russia.
US inflation, measured by the Consumer Price Index (CPI), grew 7% in 2021,� and 7.9% during the year to February � both at their fastest in four decades. The CPI's expansion outpaces economic growth at 5.7% last year and projected at 2.8% this year.
The Fed, whose tolerance for inflation is a mere 2% per year, has vowed to bring inflation back to its target with a series of rate hikes through 2023. The S&P 500 and other US stock indexes initially fell sharply on the Fed's aggressive tightening plans before recovering in recent weeks.
