Heading: Fed Chief Powell hints at possible interest rate change in September

Summary: Jerome Powell, the Chairman of the U.S. Federal Reserve, has indicated at the Jackson Hole central bank conference that an interest rate cut in September is possible, provided economic data permit. Inflation has weakened in recent months, and the labor market is also showing signs of cooling. Markets responded with a rise in the euro and falling bond yields.

Article:

Jerome Powell, Chairman of the US Federal Reserve, hinted at a possible interest rate shift at the Federal Reserve Conference in Jackson Hole. After the Fed has kept the key interest rate unchanged since July 2023, and most recently held it at a 23-year high in the range of 5.25 to 5.50 percent, the first cut could occur in September. "It is time to realign monetary policy," Powell explained, emphasizing that further steps in interest rates depend on the development of economic data.

Powell welcomed in his speech the recent decline in inflation, which has slowed down again in recent months. In July, the inflation rate dropped by 0.1 percentage points to 2.9 percent, but it remains above the Fed's target of two percent. "My confidence has grown that inflation is on a sustainable path back to two percent," Powell said.

At the same time, Powell noted that the labor market, which had long been considered robust, is now showing signs of cooling. A slowdown is "unmistakable," the Fed chairman emphasized.

Here is the translated heading in English:

"The markets reacted immediately to Powell's statements. The US dollar lost value, while the Euro rose to as high as 1.1191 dollars, reaching the highest level in a year. There was also a decline in yields in the bond markets, while the stock markets gained.

Powell's Hints of a Possible Interest Rate Reversal Reflect the Uncertainty the Fed Faces.

With his speech in Jackson Hole, Powell made it clear once again that the Fed adjusts its decisions flexibly according to economic developments. Whether an interest rate reversal will actually occur will become apparent in the coming weeks.