just now
The much-anticipated annual economic symposium in Jackson Hole, United States, has officially begun, bringing with it heightened market expectations. All eyes are on Federal Reserve Chairman Jerome Powell, who is scheduled to speak today (Friday, 2 pm GMT). The market is eager to hear any hints he might offer about a potential interest rate cut in the upcoming decision on September 18.
Powell’s Speech - A Pivotal Moment for Global Markets
Powell is set to provide insights into the economic outlook for the world’s largest economy during a year filled with significant milestones. Among these are gold reaching historic highs, the looming U.S. presidential elections, and Wall Street anticipating gains following yesterday’s negative close. With a touch of moderation, these positive movements have also spread to Asian and European markets.
Key questions surrounding Powell’s speech echo our previous newsletter: Will the interest rate cut in September be 25 or 50 basis points? Additionally, the realistic assessment of recession risks will be closely monitored, especially after weak U.S. labour market data has sparked concern over the past month.
Given Powell’s typically cautious approach, it wouldn’t be surprising if he refrains from providing concrete signals to the world’s central bankers. However, the upcoming FOMC meeting, the severe market drop in early August, and the ongoing Jackson Hole symposium have certainly increased the pressure.
In this context, the dollar continues its downward trend, falling to levels not seen since March 2024. Meanwhile, the euro has surged to new highs for the year, crossing 1.115, with the 2023 peak of 1.127 now within reach as a technical target.
The Jackson Hole symposium is underway, signalling the imminent start of an interest rate-cutting cycle in the economy that drives the world.
