Powell’s Speech at the Economic Club of Chicag
Powell’s remarks at the Economic Club of Chicago revealed little new information, though he did disappoint doves by stressing their focus on protecting against tariff-driven price hikes from driving a long-term rise in inflation expectations. Powell tried to maintain the Fed’s neutrality irrespective of politics by stating that “our independence is a matter of law”, and tried to assuage market concerns by describing recent market moves (in bonds) as functional and orderly.
US markets sold off 2-3% in response due to a lack of rate cut guidance, but more importantly from concerns about lower tech earnings guidance (TSMC, NVDA, ASML) as a tariff fallout. Crypto traded water for the most part though technicals remain more constructive in the near term as long as BTC can hold above 81k, with markets focused on details on Trumps 1st trade deal when it arrives, as well as the corporate earnings season kicking into high gear starting next week.