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Fed Chair Speech Could Focus on Next Downturn

Federal Reserve Chairman Jerome Powell may use his closely-watched speech in Jackson Hole to discuss how the central bank plans to fight the next downturn.

The topic is front and center because “we’re no longer in the early innings” of the expansion, noted Carl Tannenbaum, chief economist at The Northern Trust Co.

“Monetary policy has to think forward a little bit on how the business cycle and global economic environment will evolve,” he added.

Powell is speaking on “monetary policy in a changing economy” on Friday at 10 a.m. Eastern from the central bank’s annual summer retreat in the Grand Teton Mountains.

While it’s not certain what the speech will be about, the minutes of the Fed’s meeting in early August revealed that officials had a lengthy discussion of their game plan if rates go back to zero. They said the discussion was prudent planning. There is no sense that a recession is just over the horizon.

via MarketWatch

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