In his final speech at Jackson Hole, Fed Chairman Jerome Powell appeared to open the door to cutting interest rates. He talked about some of the ongoing financial issues and policies to address them.
Powell did not make any firm commitments and was careful to describe the complex situation. However, his tough stance may be wavering, which could be a good sign for the crypto market.
Jerome Powell's Speech
Fed Chairman Jerome Powell’s speech at Jackson Hole has been highly anticipated , as it could cause major price movements for Bitcoin. Even if President Trump fails to replace him , his term ends in May next year. Therefore, this is almost certainly his last speech at Jackson Hole.
In other words, if he is going to change his strong resistance to rate cuts , now would be the time. Billions of dollars in crypto options expire today, and the US Treasury has been buying up debt . A lot now depends on Jerome Powell's speech, and he highlighted some of the issues at play:
“This year, the economy has faced new challenges. There is considerable uncertainty about where these policies will eventually settle, and what the long-term impact will be. While the labor market appears to be in balance, it is a strange kind of balance,” he said.
Jerome Powell highlighted the impact of Trump's tariffs , weak US jobs data, rising inflation , and more. He mentioned several scenarios where the economic outlook could continue to deteriorate, and seemed to hint at the possibility of a rate cut:
“What are the implications for monetary policy? Our policy rate is now 100 bps closer to neutral than it was a year ago. The current state of the labor market and the unemployment rate allow us to proceed carefully as XEM changes to the stance of policy. A change in the balance of risks could require us to change the stance of policy,” Powell said.
However, Jerome Powell did not make any firm commitments. He described a few hypothetical scenarios where rate cuts would be urgent, but did not suggest that we were there yet. For now, the hope of cuts in the near future is all the market can hope for. No promises.
