Analyst: Powell opens the door to a 50 basis point rate cut, which may come soon

Jinshi Data News on August 23rd, Steve Englander, Global Forex Research and Macro Strategy Director at Standard Chartered Bank, said that the market’s reaction, namely the weakening of the US dollar and a slight decline in bond yields, is roughly correct. Powell did not say, ‘Yes, we want to start a loose cycle with three 50 basis point rate cuts,’ what he did was to pay great attention to the fact that the inflation target is within reach. They are concerned about the labor market and said that the labor market does not need to deteriorate further. Therefore, without giving a timetable, these remarks imply that the door has been opened to cut interest rates by 50 basis points at some point. We still do not think that a 50 basis point rate cut is the first move, but if the labor market continues to weaken, it may come soon.