Earlier currently (August 26), Federal Reserve Chairman Jerome Powell delivered a keynote tackle at the 2022 Economic Policy Symposium, to be held (August 25-27) in Jackson. Hole, Wyoming and hosted by the Federal Reserve Bank of Kansas City.
In a single speech titled “Monetary Policy and Price Stability,” Powell stated:
“The crucial aim of the Federal Open Market Committee (FOMC) now is to deliver inflation back to our two% target. Price stability is the accountability of the Federal Reserve and the basis of our economic climate. Without selling price stability, the economic climate is not in the curiosity of anyone…
“Restoring selling price stability will consider a extended time and will need the intensive use of our resources to superior stability provide and demand. Reducing inflation will very likely need a extended time period of development beneath trend. In addition, there is very likely to be an easing of labor industry situations. While greater curiosity costs, slower development and loosening labor industry situations will lower inflation, they will also hit households and enterprises. These are the unfortunate fees of decreasing inflation. But failure to restore selling price stability would indicate far better soreness.
“The target range gain in July was the second 75 basis point gain in many meetings and then I said another unusually large increase could be appropriate in our next meeting. We are now halfway through the interim phase. Our decision at the September meeting will depend on the total amount of incoming data and the evolution of the outlook. At some point, as the monetary policy stance tightens further, it may become appropriate to slow the pace of growth.“
Powell’s hawkish tone suggests that traders have been suitable to be concerned about today’s speech. Currently (as of 15:43 UTC on August 26), US stocks are struggling currently, with all 4 important US stock indexes in the red:
The crypto industry is even worse currently, with Bitcoin ($BTC) trading about $twenty,764 (-three.51%) and Ethereum ($ETH) trading about $one,590 (-six.04) %).
Here’s what prominent macroeconomist and crypto analyst Alex Krüger had to say about Powell’s speech:
AP is a two-way mess. Bears Won, V Reversal Up, Bearish $BTC chart, the weekend is coming, it really is time to defend and reassess on Sunday.
– Alex Kruger (@krugermacro) August 26, 2022