Fed Chief Powell says stock prices appear 'fairly highly valued'

Core Viewpoint - The U.S. Federal Reserve Chair Jerome Powell indicated that asset prices, including stocks, are at elevated levels, but he does not see this as a time of heightened financial stability risks [1][3]. Group 1: Market Conditions - Powell acknowledged that equity prices are considered fairly highly valued by many measures [2]. - In the lead-up to recent policy meetings, there was a strong rally in stocks and other assets, driven by expectations that the Federal Open Market Committee would lower its benchmark overnight borrowing rate [2]. - Following the decision to cut rates by a quarter percentage point, stocks have continued to reach record highs for major averages [2]. Group 2: Financial Stability - Despite the high equity values, Powell stated that the current environment does not present elevated financial stability risks [3]. - The Federal Reserve monitors overall financial conditions to assess whether their policies are achieving desired outcomes [2].