Powell ‘Sees the Light’ in His Final Jackson Hole Talk

Commentary

All three major market indexes approached or reached new all-time highs last Friday after three down days in the middle of last week. The Friday surge came after Fed Chair Jerome Powell delivered an extremely dovish speech at the Kansas City Fed Conference in Jackson Hole, where he signaled “a shifting balance of risks” that “may warrant adjusting our policy stance.” Additionally, Powell said that “downside risks to employment are rising.” This tells us the Fed’s employment mandate is now overshadowing its inflation fears. Adding to the Fed’s new focus on jobs, jobless claims rose to a two-month high of 335,000 last week.