Wall Street bets Powell will confirm rate cut, but is vague on magnitude

Wall Street is betting that Federal Reserve Chairman Jerome Powell will confirm at the Jackson Hole annual meeting that the Fed is about to cut interest rates. But as the focus shifts from "will there be a rate cut" to "how much the rate cut will be," stock traders may be disappointed. "If traders hear that a rate cut is coming, the stock market will react positively," said Eric Beiley, executive managing director of wealth management at Steward Partners Global Advisory. "If you don't hear the information you want, it will trigger a massive sell-off." The market fully expects the Fed to start cutting interest rates at its September meeting. But Powell could easily remain tight-lipped about the timing of the rate cut when he speaks on Friday. In keeping with his characteristics, he is also likely to take a cautious and vague approach to revealing how much interest rates may fall after the Fed completes its easing. "The market is confident that a rate cut will be coming soon," Beiley said. It would be a huge surprise if Powell did not emphasize that this is the future path. (Jinshi)