BlockBeats news: On August 28, Morgan Stanley’s Chief U.S. Economist Michael Gapen and Global Macro Strategy Head Matthew Hornbach expect that Fed Chair Powell’s speech at the Jackson Hole symposium is unlikely to provide significant short-term interest rate guidance. Given Powell’s previous repeated advocacy for reducing Fed communication and forward guidance, he is unlikely to focus extensively on the September meeting decision, December rate levels, the number of rate hikes or cuts this year, or short-term balance sheet policy.
Morgan Stanley believes that Walsh may use this speech to outline longer-term policy directions on issues such as the Federal Reserve’s balance sheet, inflation framework, communication methods, AI and productivity, and the quality of U.S. economic data. These topics correspond to several working groups previously established by Walsh.
Morgan Stanley expects that the focus of this speech may not be on previewing the September interest rate decision, but rather on Waugh’s first systematic explanation of the direction he hopes to take the Federal Reserve.