Powell's press conference - key takeaways

US central bank decided to deliver a 25 basis point rate hike, putting Fed funds rate in the 5.25-5.50% range. This is the highest level of rates in the US since the beginning of 2001! However, there were no major changes in the statement and investors are eager to see whether Jerome Powell still sees at least one more rate hike this year as a base case scenario given recent drop in inflation. Fed Chair's presser began at 7:30 pm BST.  Below are key takeaways:

Opening statement:

• FOMC remains focused on the dual mandate
• Strong labour market will not be achieved without price stability
• FOMC will take data-dependant approach to future hikes
• Full effects of tightening are yet to be felt
• Activity in housing market picked-up but remains below last year's levels
• Growth in consumer spending has slowed from earlier in the year
• There are continuing signs of labor supply and demand coming into better balance
• Labor market remains very tight
• Labor demand still substantially exceeds supply
• Nominal wage growth has shown some signs of easing
• Inflation has moderated somewhat
• Inflation expectations remain well anchored
• Process of getting inflation to 2% has a long way to go
• I have been seeing effects of tightening in some secotrs
• FOMC will take cumulative tightening and lags into account
• Reducing inflation will likely mean below-trend growth

USD pulled back during opening statement from Powell but scale of the move was small. Wall Street indices build onto previous gains and moved session highs. US500 approaches 4,600 pts mark.

Q&A session:

• We haven't made a decision to hike at every other meeting
• Intermeeting data came in broadly in-line with Fed's expectations
• If data suggests more hikes are needed that is the judgment we will make
• It's possible we will hike in September if data warrants it
• We believe policy is restrictive
• Economic resilience is a good thing
• At margin, stronger growth could lead to more inflation
• We are going to be careful about taking too much signal from one signal inflation reading
• We will be looking to see if signal from the June CPI is replicated
• September move is dependant on data which we don't have yet
• We need to see inflation durably down
• Core inflation is still pretty elevated
• We're going to need to hold policy at restrictive levels for some time
• Core inflation is better signal of where headline going
• Some softening in labor conditions is still likely outcome
• Policy not restrictive enough for long enough
• I am prepared to further tighten if it's appropriate
• We are not taking moving at consecutive meetings off the table
• This is not an environment where the FOMC should provide lots of forward guidance
• Real Fed Funds rate is at meaningfully positive level
• Inflation has proven more resilient than expected
• We can afford to be a little patient
• Don't think there will be cuts this year
• Several FOMC members say they expect rate cuts next year
• Staff no longer forecasts a recession this year
• There is a path to soft landing
• Would stop raising rates before getting to 2% inflation
• I don't see inflation back at 2% until about 2025

Equity indices continued to move higher during Q&A session. US500 reached fresh daily highs near 4,610 pts but started to give back gains later on and is now trading near 4,580 pts. EURUSD tested 1.11 area but failed to break above and also pulled back by the end of the presser.