Watch Out: FED Chairman Jerome Powell to Speak This Week.
Fed Chair Jerome Powell will speak at the New York Times DealBook Summit on December 4, and markets will be closely following Powell's comments on the pace of rate cuts.
The speech comes amid rising expectations following the release of the minutes of the Federal Reserve's November monetary policy meeting, which revealed policymakers are taking a cautious stance on future rate cuts.
Federal funds futures suggest markets are pricing in interest rates to fall from the current 4.5%-4.75% range to around 3.8% by the end of 2024. That's a significant shift from September's forecast, with expectations now pointing to cuts of more than 100 basis points next year.
Powell's speech was set against the
backdrop of a strong performance in
U.S. stock markets, with the S&P 500
Index posting its biggest monthly gain
since November 2023, supported by
steady inflows into global equity
funds. These funds attracted $12.19
billion this week, a 32% increase from
last month and extending a streak of
nine consecutive weeks of inflows,
according to LSEG Lipper data.
Ahead of Powell's speech, the market's attention is focused on upcoming U.S. labor market data. Strong nonfarm payrolls could signal continued resilience in the labor market, dampening expectations for aggressive rate cuts. Additional data points, such as the October job openings report and the November ADP employment report, are expected to provide more insight into employment trends.
Analysts are weighing the Fed's next moves in light of improving economic conditions. The Fed is increasingly assessing how much easing is necessary for the economy and the labor market, said Sameer Samana, senior strategist at Wells Fargo Investment Institute.