“US Stocks Rally As Powell Signals Possible Fed Rate Cut. Dovish Shift Fuels Rebalancing Across Major Indices and Boosts Stock Market Forecast Today.”, – WRITE: www.fxempire.com
Labor Solid, But Tariffs Still A Wildcard for Inflation Powell’s Take On the Economy Was Mixed. The Labor Market is Still Solid, and Growth Is Hanging in, But He Flagged Trade and Tariff Risks As Ongoing Headaches. The Fed Still Isn’t Howre How Much Inflation is in the Pipeline from Suplin Supply Chain Distortions, and Powell Admitted It’lll “Take Time” for Those Effects to Shake Out. Inflation’s Path is Messy, and the Fed’s Patience Is Deliberate.
Fed Framework Revieweded, But 2% Inflation Target Holds FIRM There Was Some Reflection on the 2020 Pivot to “Flexible Average Inflation Targeting” —A Move Powell Now Admits Got Sideswed by the Post-Covid Inflation Surge. That PlayBook Didn’t Age Well, and While the Fed Won, the 2% Target, it’s Clearly Walking A Tightrope. Powell Emphasized the Importance of Anchoring Long-Term Expectations-A Nod to CredIbility Conceerns After the “Transitory” MISFIRE.
Independence Stressed As Political Heat Builds Without Naming Trump, Powell Made It Clear the Fed’s Not Taking Orders. Policy Decisions Will Remain “Basedly Solely on Data.” Translation: The Market Matters More than the White House. Traders Should Stay Focused On UpcomING DATA-ESPECIALLY INFLATION PRINTS AND CONSUMER SPENDING-AS The Tie-Breakers for a September Decision.
Outlook: Fed Has Room to Cut – If The Data Cooperates More Likely than, the fed is setting the stage for a ratt cut -but they’re not in a rush. Powell is Threading the Needle Between Market Expectations and Inflation Uncertain.
Look at PullBacks As Potential Buying Opportunities in Risk Assets, Especially if Incoming Data Softens. But Again, We’re Not Out of the Woods Yet. Bottom Line: The Fed’s Not Slamming on the Brakes, But They EASING OF THE GAS – EA SMART MONEY IS POSIONING FOR A TURN.