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after four months tug of war there seems to be some peace between financial markets and the federal reserve I'm Jonathan Spicer writers fed correspondent here New York out fed chair Powell sealed the peace treaty with the promise of patience on any further rate hikes that was in January and that may seem like a brief pause are on the way to further rate hikes but interviews with several policy makers and those close to the process %HESITATION show that it was actually a a more of a permanent resolution of one of the key debates within the central bank financial crisis ushered in a brand new reality for the US economy and for the world economy the resolution within the fed is namely that it may never get back to the way things were when a hot economy brought in inflation and the fed could raise rates well above two and a half percent where it is now this reckoning at the U. S. central bank was brought on by Powell himself when in early October he said that the fed was a long way from what he thought was neutral %HESITATION now this set off immediate volatility in financial markets months of selling including trillions of dollars wiped out of %HESITATION household wealth investors through this time seem to be screaming at the at the federal reserve that %HESITATION the US economy just couldn't withstand any more of these %HESITATION interest rate hikes as strong as it appeared late last year especially with trump's stimulus winning in two thousand nineteen the message really didn't make it through to the fed until December when a small group of policy makers after months of agitating might manage to convince chair Powell and other court decision makers at the fed to change policy decisively the execution though was not exactly graceful in mid December when chair Powell wanted to sue the financial markets he set off another bout of Sally when subtle shifts in the policy statement was were totally overlooked by the fact the fed actually raise interest rates one last time , it wasn't until January when the fed finally got its message right and it said decisively that these interest rate hikes were shelved possibly for good