Watch Live: Will Fed Chair Powell Push Back Against The Dovish Dots?

Having delivered the 25bps rate-cut that President Trump had been hoping for, Fed Chair Powell is now facing the gauntlet of a press conference with one governor who has been fired (or not) and another member fresh from The White House.

Will Powell push back against the relatively dovish tone?

Aside from the drama, the big question is – will Powell offer a more dovish outlook (to match the market’s expectation and the new dot plot) or will he course-correct once again (and crush the market’s dovish dreams).

As a reminder, Chair Powell’s tone shifted between the July FOMC and Jackson Hole and given the demise of the labor market since then, we see no reason for his tone to shift back.

With the conflict between inflation risks on the upside and employment risks on the downside, we expect Chair Powell to reinforce that policy is not on a preset course and is data dependent.

But we also expect he will point to a new course, of gradual, cautious, data-dependent policy easing.

The lowest dot has the “terminal” rate, or where the Fed stops cutting, at 2.4% in 2027, corresponding to 175 basis points more in easing from where we are now. Or 200 including today’s cut. That’s still shy of Trump’s 300.

So, to clarify:

The Fed is cutting rates, and projecting more rate cuts, at the same time as upgrading its growth forecast and nudging up its inflation outlook too.

Good luck explaining that Jay!

Watch Fed Chair Powell thread the needle live here (due to start at 1430ET):