Powell is set to speak in Jackson Hole on Friday, and everyone is guessing whether he will announce a rate cut in September. As it stands, he is likely not to shut down this possibility and will leave various options open.

Many people in the market believe the Federal Reserve should start easing policies, but Powell may say that the path to easing is not certain yet.

After all, although U.S. inflation has decreased somewhat, it is still far from the 2% target, and the job market is quite hot, which makes the Federal Reserve cautious about whether to shift to an easing policy.

Some research firms suggest that Powell might deliberately manage expectations so that people do not hope too much for a September rate cut, in order to prevent the market from assuming that a rate cut is certain before the Federal Reserve prepares for the September meeting and enters a quieter phase. If this happens, the market could become chaotic, and an overly loose financial environment would hinder the Federal Reserve's ability to control inflation.

If Powell indeed does not clarify the matter of a September rate cut and even emphasizes policy uncertainty, then the market that previously believed a rate cut was certain would need to adjust. U.S. Treasury yields might rise, the dollar could gain some support, and growth stocks in the U.S. equity market, which are heavily influenced by interest rates, might not perform well temporarily.

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