In his final speech in Jackson Hole, Fed Chairman Jerome Powell expressed openness to the possibility of lowering interest rates. He addressed various ongoing fiscal issues and the policy approaches to resolve them.
Powell did not make firm commitments and struggled to describe the complex situation. Still, his firm stance may be weakening, which could be positive for the crypto market.
Speech by Jerome Powell
Jerome Powell's speech in Jackson Hole was highly anticipated, as it could trigger large price movements for Bitcoin. Even if President Trump fails to replace him, his term will end next May. Therefore, this is almost certainly his last speech in Jackson Hole.
In other words, if he were ever to change his firm resistance to interest rate cuts, now would be the time. Billions in crypto options are set to expire today, and the U.S. Treasury has been buying back debt. Much is currently riding on Jerome Powell's speech, and he highlighted some ongoing issues:
“This year, the economy has faced new challenges. There is significant uncertainty about where these policies will eventually settle and what the lasting impact will be. While the labor market seems to be in balance, it is a curious kind of balance,” he stated.
Jerome Powell highlighted the impact of Trump's tariffs, weak U.S. job data, rising inflation rates, and more. He referred to several situations where the economic outlook could continue to deteriorate and seemed to suggest a possible interest 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 instability of the labor market and our unemployment rate now allows us to proceed with caution when considering changes to our policy stance. The changing balance of risks may require us to change our policy stance,” Powell stated.
Even so, Jerome Powell did not make firm commitments. He described some hypothetical scenarios where interest rate cuts would be urgent, but did not suggest that we are already at that point. For now, the hope for imminent future cuts is all the markets can expect. No promises.
The article Ethereum advances after Powell signals interest rate cuts in September was first seen on BeInCrypto Brazil.
