Based on current media analyses and market coverage (such as reports from Reuters, Financial Express, and CoinGabbar), Jerome Powell's statements, the Chairman of the Federal Reserve, are expected to be cautious and not directly committed during the George P. Schultz Memorial Lecture at the Hoover Institution at Stanford University, especially with the FOMC meeting approaching on December 9-10. The event starts at 8:00 PM Eastern Time (01:00 AM UTC on December 2), and includes brief remarks followed by a panel discussion with Michael Boskin (former economist) and Condoleezza Rice (Director of the Institution), focusing primarily on Schultz's legacy in economic policies during the Reagan administration, such as combating inflation and balanced growth.
Key points expected in the statements:
The legacy of George Shultz and historical lessons: Powell is expected to begin by affirming Shultz's role as a "model of balanced economic policy," noting how he contributed to lowering inflation without harming growth. This may be used as an indirect introduction to discussing the current balance between inflation and employment, without delving into recent details due to the "quiet period" before the FOMC meeting.
The current U.S. economy: Powell is likely to describe the economy as "in a good place," with stable growth (around 2.5% annually) and a strong labor market (adding 170,000 jobs monthly in the last quarter), but he may warn of a "strange balance" due to slowing labor supply and demand, increasing recession risks in employment. A decrease in inflation to levels close to 2% is also expected to be mentioned, supported by recent CPI data that came in lower than expected.
Inflation and monetary policy: Expectations indicate no clear signals regarding interest rate cuts in December, as Powell previously stated that "monetary policy is not on a predetermined path." However, he may hint at a potential 25 basis point cut (the third this year) if positive data continues, emphasizing the need to monitor "the data carefully." Additionally, discussions on the end of quantitative tightening (QT) on December 1 are expected, which is considered positive for market liquidity and may drive investors toward riskier assets such as stocks and cryptocurrencies.
Future risks and public debt: Powell may reiterate that the national debt (around $38 trillion) is "on an unsustainable path," citing his previous statements in May 2025, while pointing to the risks of tariffs and geopolitical tensions that could raise inflation and slow growth. In the discussion, Rice may highlight international concerns, while Boskin focuses on tax reforms and innovation (such as artificial intelligence).
Expected impact on markets:
Stocks and bonds: A cautious tone could lead to a slight rise in bond yields (such as the 10-year at 4.02%) and a decline on Wall Street, especially with current pressure from rising Japanese yields. However, a positive signal for rate cuts could support the rise.
Cryptocurrencies: High sensitivity; Bitcoin has dropped to below $86,500 currently due to tensions, with losses reaching $144 billion. A hint at monetary easing could boost a rebound, but fears from China and whale movements may exacerbate volatility.$BTC
