At the Jackson Hole meeting on August 22, Fed Chair Jerome Powell stated, “with policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance.” This remark led financial markets to price in the resumption of rate cuts at the September 16–17 FOMC.
Given lingering concerns about tariff-driven inflation and persistent political pressure from President Donald Trump for aggressive easing, many market participants—including myself—had expected Powell to avoid taking a clear stance at this stage. His words therefore came as a surprise.
