US equity markets jump towards new record levels after Powell’s speech.
US stock indices jumped after long-awaited Powell’s speech as the Fed Chair delivered his openings remarks during Jackson Hole Symposium. It might seem that Powell’s words are perceived as dovish - risky assets gained while USD tanked.
Even though several Fed speaker have been pretty hawkish recently, Powell did not outline concrete tapering date yet and some may view that as relatively dovish. The Fed Chair suggested that QE tapering could be appropriate this year, but he clearly ignored high inflation. He added that progress on job-market recovery has been noticed by the Fed, but the unemployment rate is still too high. Therefore, the NFP report for August (next Friday) will certainly be in the spotlight - a strong labour market data could possibly encourage Powell to signal QE tapering in a more decisive way during September’s FOMC meeting.
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US100 rallied during Powell’s speech and climbed to new record levels (area above 15,400 pts). It is worth to notice that market bulls managed to break above the short-term downward trend line. The area near 15,250 pts (lower limit of the 1:1 structure) remains first key support. Source: xStation5
