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Standard Chartered said the latest Federal Reserve minutes suggest that Fed Chairman Jerome Powell will take a more dovish stance at the upcoming Jackson Hole economic symposium.
The minutes of the July 31 meeting of the Federal Open Market Committee (FOMC) contained numerous references to “nearly all” or “a large majority” of participants favoring a softer approach.
“The minutes of the July 31 FOMC meeting are so dovish that they open the door to a 50 basis point cut immediately after, if not at the September 18 meeting,” said Standard Chartered’s global research team. The analysis noted a strong emphasis on downside risks to economic activity, softening labor markets, expanding disinflation signals and concerns about waiting too long to ease policy.
According to the CME FedWatch tool, the probability of a 50 basis point rate cut at the Sept. 18 meeting currently stands at 26.5%, while Wall Street is looking more favorably at a 25 basis point cut, with a 73.5% chance.
For investors and market participants, these signals may prompt closer scrutiny of Treasury bonds and notes that are directly affected by changes in interest rates and the broader monetary policy outlook.
As the FED's Jackson Hole symposium approaches, all eyes will be on Powell's statements that could provide more clarity on whether a more aggressive rate cut is on the horizon. As Bitcoinsistemi.com, we will share these statements with you immediately.
*This is not investment advice.