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The markets closed a difficult week on an upbeat note, as stocks were trending higher in the afternoon trading session to end the day in the green.

The afternoon surge coincided with a speech delivered by Federal Reserve Board Chairman Jerome Powell at 12:30 p.m. ET in New York.

Powell didn’t say anything new or controversial or different about the economy or monetary policy – and that’s probably why the markets responded positively.

In a volatile and at times chaotic week, the markets seemed to respond well to Powell’s calm, measured, steady hand at the wheel.

As of 3:00 p.m. ET, all of the major indexes were up, after being down in the morning. The Dow Jones Industrial Average was up about 200 points, or 0.5%, while the S&P 500 gained roughly 28 points, or 0.5%. The Nasdaq Composite index jumped 100 points, or 0.6%, while the Russell 2000 surged 15 points, or 0.7%.

No news is good news

As mentioned, Powell really didn’t say anything new or different on Friday. Most notably, he called conditions in the labor market as solid and “broadly in balance.” Citing the February jobs report, Powell noted that the economy added 151,000 jobs in February and the unemployment rate was 4.1 percent last month.

Since September, smoothing over the month-to-month volatility, employers have added 191,000 jobs per month on average. And the unemployment rate remains low and in a narrow range between 3.9% and 4.2% for the past year. Further, the jobs-to-workers gap has narrowed, the quit rate is below pre-pandemic levels, and wages are growing faster than inflation.

“With wage growth moderating and labor supply and demand having moved into better balance, the labor market is not a significant source of inflationary pressure,” Powell said.

On inflation, Powell noted that recent results have kept inflation rates somewhat elevated. He also acknowledged that the road to returning inflation rates to its 2% goal has been bumpy, and the Fed expects that to continue.

But Powell also said the Fed does not overreact to month-to-month fluctuations that are higher or lower than anticipated.

“We pay close attention to a broad range of measures of inflation expectations, and some near-term measures have recently moved up,” Powell said. “We see this in both market- and survey-based measures, and survey respondents, both consumers and businesses, are mentioning tariffs as a driving factor. Beyond the next year or so, however, most measures of longer-term expectations remain stable and consistent with our 2 percent inflation goal.”

Waiting for clarity on Trump policies

Powell reiterated his previous comments that the Fed is in no hurry to lower interest rates and is “well-positioned to wait for greater clarity.”

That clarity should come as the Trump Administration implements significant policy changes in four areas — trade, immigration, fiscal policy, and regulation.

“It is the net effect of these policy changes that will matter for the economy and for the path of monetary policy,” Powell said. “While there have been recent developments in some of these areas, especially trade policy, uncertainty around the changes and their likely effects remains high. As we parse the incoming information, we are focused on separating the signal from the noise as the outlook evolves.”

Powell concluded with his usual commentary that policy is not on a preset course.

“If the economy remains strong but inflation does not continue to move sustainably toward 2 percent, we can maintain policy restraint for longer,” he said. “If the labor market were to weaken unexpectedly or inflation were to fall more quickly than anticipated, we can ease policy accordingly. Our current policy stance is well positioned to deal with the risks and uncertainties that we face in pursuing both sides of our dual mandate.”

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