NEW YORK: Wall Street stocks ticked up early Friday (Aug 22) ahead of a highly anticipated speech by Federal Reserve Chair Jerome Powell, as investors look for clues on the future path of interest rates.
Shortly after trading started, the Dow Jones Industrial Average rose 0.6 per cent to 45,052.49, while the broad-based S&P 500 Index was up 0.3 per cent at 6,391.39.
The tech-heavy Nasdaq Composite Index climbed 0.2 per cent to 21,138.56.
Powell is due to deliver his final speech at the helm of the US central bank at 10am US Eastern Time during the Jackson Hole Economic Policy Symposium, and all eyes are on his remarks about the state of the world’s largest economy.
While markets broadly expect the Fed to make a 25-basis-point rate cut at its next policy meeting in September, analysts expect Powell will open the door to this possibility without locking it in.
A swing factor is the labour market, after official employment data released early August showed that hiring in May and June was significantly weaker than expected.
Heather Long, chief economist at the Navy Federal Credit Union, told AFP that she will be monitoring how Powell characterises the jobs market.
A key question is whether the cooldown was due to issues like lower immigration – making a rate cut less likely, given that President Donald Trump’s tariffs could fuel inflation – or because of a demand slowdown.
If demand was weakening and companies pulled back or laid workers off, the Fed might be more inclined to slash rates to boost the economy, she said.
