Wall Street responded sharply to Federal Reserve Chair Jerome Powell’s address at the Jackson Hole symposium on Friday. The speech, delivered amid mounting economic uncertainty and political pressure, provided new signals on the Fed’s interest rate outlook that immediately moved stocks, bonds, and global currencies.
Powell’s speech carefully balanced concerns: He acknowledged unusual weakness in both hiring and inflationary trends, and signaled confidence that the impacts from tariffs might be temporary. Investors and analysts viewed this as an indirect endorsement of policy easing, though Powell stopped short of explicitly pledging a cut.
Traders are now positioning for the Fed’s September meeting, with markets pricing in up to two rate cuts by year’s end. Analysts caution that sustained market gains are contingent on Powell’s continued focus on downside risks and the ongoing tug-of-war between inflation data and jobs figures.
Overall, Powell’s Jackson Hole speech quickly reversed the recent stock market slide and triggered renewed optimism that the Fed may act to support growth—while underscoring the uncertainty clouding monetary policy for the remainder of 2025.
For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing.
