FED Faces Crucial Test as Powell Heads to Jackson Hole

Jerome Powell's upcoming speech at Jackson Hole has markets on edge, with investors across bonds, crypto, and equities awaiting clarity on the Federal Reserve's rate-cut timeline. A 70% probability of a 0.25% September cut is priced in, but sticky inflation and softening labor data complicate the outlook. Powell must navigate hawkish Fed voices against market expectations—a misstep could trigger volatility from Treasuries to Bitcoin.

Bond traders anticipate 75 basis points of cuts by December, yet two-year and five-year yields already reflect jitters. Powell’s history of using Jackson Hole to steer expectations raises stakes: his 2024 hints at easing sparked rallies. This time, crypto markets hang in the balance—BTC and ETH liquidity often tightens when Treasury yields swing.