Listening to central bankers is like trying to date an emotionally reserved girl - you can talk and listen all you want, but you will never hear the words of commitment. But while it is perpetually frustrating to not be able to get assurances about the future of rates, it is done by design.
Market watches all the time - one word too much and your commitment gets priced in instantly. Just like at Jackson Hole. Powell only mentioned that job numbers revision may signify a weakening labor market and in a second markets priced in an 80% chance of a 25bps rate cut.
Yeah, well done mate, we can pat ourselves on the back and move on to October meeting, right? Not really. To understand the direction of central bankers moves, you need to meticulously dissect their speeches. And that’s what I will do today. I will analyze Powell’s speeches, FOMC minutes and data in the context of Fed’s dual mandate to see where we really stand and if there is money to be made. Hit that subscribe button and see for yourself.