According to Odaily Planet Daily, Wall Street is betting that Federal Reserve Chairman Powell will confirm that the Fed is about to cut interest rates at the Jackson Hole Annual Meeting. But as the focus shifts from "whether there will be a rate cut" to "how much the rate cut will be," stock traders may be disappointed.
Eric Beiley, executive managing director of wealth management at Steward Partners Global Advisory, said that if traders hear that a rate cut is coming, the stock market will react positively. If they don't hear the desired information, it will trigger a massive sell-off.
Markets fully expect the Fed to start cutting rates at its September meeting. But Powell could easily remain tight-lipped about the timing of those cuts when he speaks on Friday. True to his nature, he is also likely to take a cautious, vague approach to revealing how much rates might fall once the Fed is done easing.
"The market is so confident that a rate cut is coming soon," said Bailey. "It would be a huge surprise if Powell didn't emphasize that this is the path forward."