TechFlow, August 20 — According to Jinshi Data, Mike Sanders, Head of Fixed Income at Madison Investments, said that Fed Chair Powell may attempt to inject some "uncertainty" into market expectations for rate cuts during his speech at this Friday's Jackson Hole global central bankers' symposium. Money markets currently price in an 84% chance of a Fed rate cut in September, but Powell "should want to temper this confidence to preserve flexibility in case upcoming data disappoints." He noted that if inflation comes in higher than expected or employment data rebounds, such caution would give the Fed room to maneuver.
Sanders said data released between Jackson Hole and the September FOMC meeting could significantly alter the market outlook. Powell "must not allow the Fed to be effectively locked into a rate cut in September."
