Cryptos, stocks slip off, while retailers unpack Powell's comments on Jackson Hole

Cryptos, stocks slip off, while retailers unpack Powell's comments on Jackson Hole

The chairman of the US Federal Reserve, Jerome Powell, took a more restrictive attitude during his comments in Jackson Hole on Friday morning and sent the stocks to slide. The cryptoma markets were mixed because the dealers continue to speculate what will happen at the next Fed policy meeting in September.

While recent data, such as sinking unemployment and the latest report by the consumer price index (CPI), could indicate that inflation cools down, the central bank chief warned that it was still a long way until permanent price stability was achieved.

"Estimates of long-term neutrality are not a place where you can stop or stop," said Powell during his speech on the second day of the Symposium organized by the Kansas City Federal Reserve.

"Our decision at this meeting in September will depend on the entirety of the incoming data and the developing prospects," he said.

powell's speech influenced the appointment markets easily, which immediately after the statements a probability of 54.5 % for an interest rate increase by 75 basis points in September Data from the CME group. In the days before the meeting in Jackson Hole, the likelihood of a third increase of 75 basis points in a row was 58.5 %.

The S&P 500 slipped after the speech and lost 1 %. The technology -based Nasdaq also lost and was traded by 1 % lower at the time of publication. Bitcoin and ether also decreased and lost 0.4 % or 1 %.

"The statements of the Fed chairman Powell initially made the markets shudder, and they were sold out because they insisted that the central bank will continue to raise interest rates until it has the feeling that inflation is under control", Josh Olszewicz, research manager at Digital-Aßet-Fonds manager Valkyrie Investments, said.

"Powell's admission that there will be pain before there is relief is pretty Hawkish, but both stocks and crypto-assets showed surprising resilience by recovering quite quickly, which can be interpreted as evidence that the next interest increase is probably already pronounced," said Olszewicz.

Even if the futures markets remained mixed, Olszewicz relies on the fact that the markets of Powell's statements will interpret restrictively. For the end of September, he predicts a further interest rate increase of 75 basis points, from which he expects the markets to have already priced this largely.

"[i] do not expect a drastic effect on the markets, should this occur, followed by successive interest rate increases, until inflation is contained and the unemployment rate returns to a healthier value," said Olszewicz.

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The article Cryptos, Equities Slide as Traders Unpack Powell’s Jackson Hole Remarks is not a financial advice.