Overview

• Traders now put the probability of a September cut near 83%, according to CME FedWatch, after Powell’s Jackson Hole remarks.
• The Dow closed at a record, the S&P 500 rose 1.5%, the Nasdaq gained 1.9%, and small caps led with the Russell 2000 up 3.9%.
• Treasury yields fell on the shift in expectations, with the 10-year at 4.25% and the 2-year at 3.69%.
• Powell noted slower hiring and described the labor market as in a “curious kind of balance,” signaling openness to adjusting policy at the Sept. 16–17 meeting.
• He cautioned that tariffs are lifting goods prices, while President Trump pressed for deeper cuts and threatened to remove Governor Lisa Cook as Fed officials reiterated independence.