FED Chair Jerome Powell spoke at Jackson Hole on August 22, addressing rate cuts, inflation, and the labor market.
Powell’s Friday appearance turned out to be a bonanza for intraday stock traders and crypto investors, as both the NASDAQ and major cryptos surged after he hinted at a possible September rate cut.
Powell noted that the balance of risks is shifting in the U.S. economy. While inflation remains a concern for the Fed, the latest labor market data is now a bigger worry.
Job growth, for instance, has slowed dramatically: from 168,000 new jobs in 2024 to just 35,000 in the latest figures. At the same time, unemployment has held steady at 4.2%.
This slowdown is partly due to reduced demand and supply in the job market, temporarily influenced by weaker immigration flows.
Powell warned that the labor market remains in a delicate position, and a wave of layoffs could make conditions worse.
Read on as we unpack Powell’s September rate cut hint, what’s driving it, and how you can ride the brewing risk-on sentiment among investors by loading up on the best cryptos to buy now.
Powell’s Rate Cut Hint Could Spark the Next Crypto Rally
Inflation is still around 2.6% to 2.9% above the Fed’s 2% target, largely due to Trump’s tariffs, which are expected to gradually push prices higher.
However, the Federal Reserve views this as a one-time bump rather than the start of an inflation spiral.
Speaking on interest rates, Powell noted that current levels are now closer to neutral – a zone that neither slows nor boosts the economy – and described the Fed’s stance as a little restrictive.
He added that while there’s room for a rate cut, the Fed intends to move carefully based on incoming data.
Here’s the kicker now: although Powell didn’t commit to a September cut, he admitted it’s certainly a possibility.
Wall Street celebrated the remarks, with the NA
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Author: Bogdan Patru
