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How to prepare before Powell's speech and the unemployment claims announcement?

Blerina Uruci, Chief U.S. Economist at T. Rowe Price, analyzes that Federal Reserve Chairman Powell is likely to emphasize maintaining a high degree of policy flexibility in the upcoming FOMC meetings during his speech at the Jackson Hole conference.

She mentioned that before the Federal Reserve meeting on September 17, there will be an employment report and a CPI report released. If inflation sees a significant rise or the labor market shows a substantial recovery, the probability of maintaining the current interest rate at the next meeting will be higher.

However, if the employment growth in August drops to below 50,000 per month, while the unemployment rate increases, there could be a dovish rate cut of 50 basis points.

Currently, the CME market betting situation indicates that after a significant downward revision of non-farm data and acceptable CPI performance, the mainstream market expectation is that the Fed will cut rates by 25 basis points in September, with a low probability of maintaining the current rate and an extremely low probability of a 50 basis point cut.

However, before this, Powell has never managed expectations regarding a potential rate cut in September in any public setting. Therefore, market participants are all gambling, wanting to see if Powell will continue his previous style and release signals early or 'dove' during this Jackson Hole conference.

Looking at the unemployment claims situation, historical data shows that as of the week ending August 2, the number of continuing unemployment claims was 1.974 million, reaching a new high since November 2021.

If the data exceeds expectations, it will indicate a weak job market, which may benefit gold, while the dollar and yields weaken; if the data is below expectations, it is usually seen as strong employment, which may delay the Fed's rate cut, benefiting the dollar, and gold may retreat in the short term. #杰克逊霍尔会议 #ETH质押退出动态观察