According to the latest information, Federal Reserve Chairman Jerome Powell delivered a highly anticipated speech on August 23, 2025 (Eastern Time) at the global central bank symposium in Jackson Hole, Wyoming. This was widely viewed as his final address at the forum as Fed Chairman, with the content opening the door for the Federal Reserve to begin a rate-cutting cycle.

Key Highlights:

Clear "Dovish" Signal Released: Powell clearly indicated in his speech that considering changes in the U.S. economic outlook and risk balance—particularly the significant rise in downside risks to the labor market—the timing for the Fed to adjust its monetary policy stance may have arrived. This was interpreted by markets as a strong signal for rate cuts.

Labor Market Becomes Key Trigger: Analysis shows that Powell's speech shifted focus from previous inflation stickiness concerns to employment risks. He emphasized the weakness in recent non-farm employment data (only 73,000 jobs added in July, with significant downward revisions to previous figures), noting that while the unemployment rate appears stable on the surface, "slow-boiling frog" risks are accumulating and could rapidly evolve into widespread layoffs. This "shift in risk balance" is key to the policy pivot.

September Rate Cut Almost "Set in Stone": Although Powell provided no explicit commitment, his speech was widely seen as "opening the policy window" for a September rate cut. Market expectations surged dramatically, with traders' bets on a 25 basis point cut in September jumping from approximately 65% before the speech to over 85%. Multiple economists and institutions (including Orient Securities, Deutsche Bank, Barclays, etc.) believe a 25 basis point cut in September is nearly certain.

Positive Market Response: Following the speech, financial markets reacted enthusiastically. U.S. stocks surged significantly, with the S&P 500 index posting its largest gain since May, and the Dow Jones Industrial Average closing at a record high. U.S. Treasuries, gold, copper prices, and cryptocurrency Ethereum all rose higher, while the dollar index declined.

Future Path Outlook: Markets widely expect that a September rate cut may only be the beginning of an easing cycle. The pace of subsequent cuts will depend on data, particularly the upcoming August employment and inflation reports. Institutions predict the possibility of 1-2 additional rate cuts within the year, with cumulative cuts of 50-75 basis points.

Summary: Powell's "final speech" at Jackson Hole successfully set the tone for the Fed's policy pivot. By shifting policy focus from inflation to employment risks, he sent a clear signal to markets: the Fed's rate-cutting window has opened, and the September monetary policy meeting is highly likely to initiate this easing cycle. Global investors are closely monitoring subsequent economic data to gauge the pace and magnitude of rate cuts.