Powell is about to make an important speech next week, which may cause significant market fluctuations.
The theme of this year's meeting is "Reassessing the effectiveness and transmission mechanism of monetary policy", indicating that global central banks will discuss the effectiveness of current monetary policy and future policy directions.
About Powell's possible remarks and their impact on the market:
Labor market stability: If Powell clearly states that the Fed will take precautionary measures to prevent weakness in the labor market, this will send a signal to the market that the Fed will not cut interest rates too early in the early stages of an economic slowdown. Such a statement may strengthen the market's expectations that the Fed will stick to a tight policy, leading to higher interest rates in the short term and putting pressure on the stock market.
Inflation target and policy easing: If Powell mentions the possibility of gradually lifting policy easing measures, the market may interpret it as the Fed making progress in inflation control and expecting a more relaxed monetary policy cycle to come. This may be a short-term positive for the stock market, but it may also cause fluctuations in long-term interest rates.
Powell's speech at the meeting will directly affect the market's expectations of future interest rates and economic prospects. Therefore, it is important to pay close attention to market reactions and Powell's remarks.