08/26/2024
Federal Reserve Chairman Jerome Powell strongly hinted at a September rate cut during a Jackson Hole, Wyoming, speech on Friday morning.
Powell indicated the Fed is ready to take action to lower rates, but “the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”
After recent CPI and jobs reports, many analysts have been predicting a September interest rate cut, and we’re already seeing mortgage rates react to the speculative move. Current 30-year fixed mortgage rates are hovering around 6.46%—down about 30 bps since the beginning of August.
Here are a few additional takeaways from his remarks:
Inflation has significantly decreased, but the effort to fully restore price stability is still ongoing.
Pandemic-related supply constraints and a surge in demand for goods caused the initial inflation spike.
The Federal Reserve's restrictive monetary policy has successfully eased inflationary pressures without causing a sharp rise in unemployment.
The Fed remains committed to continually adapting its policies as new data comes forward.
The next Federal Open Market Committee meeting is scheduled for Sept. 17-18.
Read Powell’s entire speech transcript here:
Four and a half years after COVID-19's arrival, the worst of the pandemic-related economic distortions are fading. Inflation has declined significantly. The la
