This statement is interpreted as a significant signal that the government may move beyond support provided through tax obligations and aim for returns through investments.

Powell Opens the Door to a Rate Cut!

Federal Reserve Chairman Jerome Powell delivered new assessments of the economy at the Jackson Hole meeting of economists. Highlighting the risks in a weakening labor market, he suggested that a rate cut could be considered; however, he also pointed out that inflation still has the potential to rise.

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Following these developments, markets around the world experienced volatility:

• Barclays and BNP Paribas began forecasting that the Fed will implement a 25 basis point rate cut in September 2025. They also noted that two separate cuts could take place within the year.
• Stock markets reflected a positive mood. The S&P 500, Dow Jones, and Nasdaq indices rose; bond yields declined. Small-cap stocks particularly stood out.
• Market probability rose to 87–90%, meaning the September rate cut has become largely “priced in.”

In his speech, Powell strongly emphasized that the Fed’s decisions would be entirely data-driven and that it would maintain its independence.

Kevin Hassett’s statement that the government may take stakes in companies signals a new era in economic policy that is centralized and investment-oriented. Meanwhile, Jerome Powell appears ready to take steps toward flexibility in interest rates while remaining committed to the Fed’s independence and data-driven decision-making.

When these two developments are evaluated together, it becomes clear that a new search for balance between public policy and monetary policy is underway. Upcoming economic data in the coming weeks will reveal this balance more clearly.

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