Will Powell Pop The 'Recession'-Preventing Rate-Cut Euphoria This Week?

Authored by Simon White, Bloomberg macro strategist,

Powell at this week’s Jackson Hole symposium has the opportunity to highlight the US’s limited near-term recession risk, and thus further reduce the likelihood of the economy feeding negatively into asset prices. The extent of anticipated interest rate cuts continues to look susceptible to a repricing.

Markets have recovered remarkably quickly after the spasm of two weeks ago. What could have quickly become a reflexive event eased back fairly quickly as there was limited follow through from slower-moving investment strategies having to deleverage.