Fed Chair Jerome Powell Speaks at Jackson Hole – Here is What You Should Know

Federal Reserve Chair Jerome Powell is taking the stage with his speech at the highly anticipated Jackson Hole Economic Symposium at the moment.

Known for his cautious approach and careful language, Powell’s remarks provide crucial insights into the Fed’s next moves. The financial world has been on edge, waiting for a much-needed rate cut after a prolonged period of high interest rates. Investors, in particular, are hoping for at least a 0.5% reduction in September.

This sentiment has intensified following the recent market turmoil, which wiped out $2 trillion from the stock market in a single day, sparking panic and increasing demands for decisive action from the central bank.

The event comes just after the U.S. Bureau of Labor Statistics revised job growth figures downward by 818,000, the largest adjustment since 2009. This suggests a weakening job market, which, alongside easing inflation, could influence the Federal Reserve’s upcoming decisions on interest rates.

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Powel stated, that the after effects from the pandemic are almost gone and inflation has declined significantly. Aditionally, the labor market is no longer overheated.

Fed’s chair stated that their job is not finished, but they are making progress as the current monetary policy eased inflation and is closer to the objective of 2%.

He also says that his confidence has grown with the recent data. The Fed is not looking for further cooling in labor market conditions and the economy continues to grow at a stable pace.

Despite this, Powell stated that the downside risk of employment has increased and that the timing of rate cuts will depend on future data.

He is confident that the inflation could go down to 2% while having a strong labor market.

Alexander Stefanov