🔸The recent speech by Federal Reserve Chairman Jerome Powell at Jackson Hole has generated a notable shift in financial markets. Against all odds, Powell adopted a moderate tone, opening the door to a possible interest rate cut.
Key Points from Powell's Speech
- Surprisingly Moderate Tone: Jerome Powell adopted a softer tone than expected, suggesting that there could be an interest rate cut in September.
- Reason for the Change: He justified his stance by mentioning that the "downside risks to employment are increasing," which could lead to a rapid rise in layoffs.
- Immediate Impact on Markets: Following his comments, markets reacted positively:
- Bitcoin (BTC) rose about 2%, reaching $114,200.
- U.S. stocks (such as the Nasdaq) increased.
- Ether (ETH) bounced back nearly 8%.
- The dollar and the 10-year Treasury yield fell, while gold rose.
- Reversal of Previous Trend: This movement reversed the bearish trend of the previous week, when markets anticipated a restrictive tone and expectations for a rate cut had decreased. Now, the odds of a cut have risen back to nearly 90%.