US Federal Reserve Chairman Powell continues to talk about the likelihood of an interest rate cut in September. Answers questions from journalists.
Key to already said:
❗️-The work to combat inflation is not finished yet, but we can afford to start easing monetary policy
- In the basic version, it can be assumed that the rate will decrease further (after the first reduction - approx.).
- Risks of rising inflation have decreased as the labor market cools. Now there are risks of a deterioration in the employment situation.
“We are now seeing broader disinflation.”
- Today's decision to pause was unanimous.
- At this meeting, arguments in favor of lowering rates were actually discussed, there was a real discussion, but the overwhelming majority supported a pause.
- We are not currently thinking about reducing the rate by 0.5 percentage points at once.
Against the backdrop of Powell’s speech, the forecast for#CMEGroupchanged to “pause or downgrade by 0.25 percentage points”:
- 14.3% - there will be either a pause or a decrease of 0.25 percentage points (before the speech it was 6.4%).
- 85.6% - there will be a decrease by either 0.25 percentage points or 0.5 percentage points (before the speech it was 93.5%).
- 0.1% - there will be a decrease by either 0.5 percentage points or 0.75 percentage points (before the speech it was also 0.1%).