Words are powerful. For the US economy, no-one’s more so than those of Fed Chair Jerome Powell. Bloomberg Economics’ Fed sentiment index — powered by a natural language processing algorithm based on more than 60,000 Fed headlines — shows that in December, Powell delivered a major pivot. By hinting at a swifter shift toward rate cuts, he gave markets a boost and helped the economy dodge a downturn. So far, so good — but there’s a catch. Four months on, with demand powering ahead and inflation stuck above target, Powell has been forced into a reversal. That started on the margins of the International Monetary Fund’s ... (full story)