Wall Street Surges as Powell Hints at Rate Reduction
(MENAFN) The New York Stock Exchange concluded the week with significant gains on Friday after Federal Reserve Chair Jerome Powell cautiously hinted at a potential interest rate decrease during the upcoming September meeting.
The Dow Jones Industrial Average jumped by 1.89%, gaining 846.24 points, finishing the session at 45,631.74.
The Nasdaq Composite climbed 1.88%, or 396.2 points, reaching a close of 21,496.53, while the S&P 500 Index advanced 1.52%, adding 96.74 points, to end at 6,466.91.
The Volatility Index (VIX)—frequently referred to as the “fear index”—declined 14.34%, settling at 14.22.
Speaking at the Jackson Hole Economic Policy Symposium, Powell signaled openness to easing rates, stating, “With policy in restrictive territory, the baseline outlook and shifting balance of risks may warrant adjusting our policy stance.”
He acknowledged that near-term risks related to inflation appear to lean upward, whereas threats to job growth seem to lean downward.
Underscoring that monetary policy remains flexible, Powell reaffirmed that the Federal Open Market Committee (FOMC) will base its decisions entirely on economic data and the evolving balance of risks.
In response to Powell’s comments, money market forecasts showed a rising probability of a 25-basis point rate cut during the Fed’s September 16–17 gathering.
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