Nomura Warns 'Soft Landing Unlikely': What Can Powell Signal At Jackson Hole?

Authored by Philip Marey via Rabobank,

Summary

• At Jackson Hole, Fed Chair Powell is likely to signal a 25 bps rate cut for September.

• The recent deterioration in economic data has raised our confidence that the US economy is sliding into a recession or at least a significant slowdown in the second half of the year.

• Therefore, we have decided to cluster the four rate cuts we forecasted from September 2024 through June 2025 in the upcoming four scheduled FOMC meetings: September, November, December and January.