Forecast of Chairman Powell's Speech Tonight

Tonight, Powell's speech will guide the market's movements.

Currently, both Powell and the Federal Reserve are under extreme pressure from the White House, particularly as Basant, who has always claimed to "not interfere" with the independence of the Fed, has recently called for a 50bp rate cut in September. This undoubtedly corners Powell. Basant's comments have been influencing the market for the past few months, and the market has indeed adjusted its rate cut expectations based on his statements. If the Fed fails to cut rates as scheduled in September, the subsequent market sell-off will become an excuse for a new round of attacks from the White House. This civilized political calculation and the barbaric personal attacks from the 'king of understanding' leave Powell treading on thin ice.

However, I maintain my previous judgment that Powell is a seasoned bureaucrat. He will not focus solely on the immediate path while forgetting the road behind him. The current employment and inflation data are extremely unclear; until the Labor Department provides further data in early September, Powell has no need to make rash judgments or cut off his own retreat. Powell's goal is defense, and even to use a hawkish tone to solidify inflation expectations before actually starting the rate cut cycle.

There is not much left for Powell to do for the Fed and the market. Carry the burden and walk the last stretch. #杰克逊霍尔会议