After the speech by FED chairman Jerome Powell, analysts and brokers will assume last Friday during the Jackson Hole conference in Wyoming that the American system of central banks will lower interest in September. According to Matthew Ryan, head of investment strategy with asset manager Ebury, FED chairman Jerome Powell in his speech issued a clear signal that a reduction in the American policy interest in September is likely. “Powell pointed out that the balance of risks” can justify the adjustment of the policy “and was clear to worry more about the labor market than about inflation. He also added that the inflatoid effects of the American rates are likely to be short -lived. “
The markets interpreted Powell’s remarks such as a confirmation that the Fed will lower interest rates in September, with probably an extra reduction in December. According to Ryan, the chance of one takes dovish Policy path further, which means that the Fed lets the strict course sail somewhat.
“At the same time, the market reaction was substantial: the US dollar dropped sharply due to the re -pricing of interest expectations, while the short interest rate on treasuries also fallen considerably,” says Ryan. “This image supports that the Fed is temporarily shifting to protecting jobs, even if that means inflation of the objective of the objective of the objective of the objective of the objective of the objective of the objective of the objective of the objective of the objective of the objective of the objective of the objective of the objective of the objective of the objective for longer above the objective of the objective of 2 percent.”