Fed Chairman Powell delivered a captivating speech at the Jackson Hole Annual Economic Policy Symposium, where the signals released were widely interpreted by the market as leaning towards easing. This statement immediately triggered a strong reaction in the financial markets, with investors adjusting their expectations for the future direction of monetary policy.

The most striking part of Powell's speech is the statement that 'the balance of risks is changing.' This phrase is seen by market participants as a hint that the Fed's policy stance may undergo a significant shift. Combined with the recent signs of weakness in the labor market and the persistent easing of inflationary pressures, investors' confidence in the Fed's imminent shift towards rate cuts has greatly increased.

The market reacted quickly and violently. The futures market showed that traders rapidly adjusted their bets on a possible interest rate cut in September, with the related probability once approaching 90%. This shift in expectations reflects the market's high sensitivity to the economic outlook and the direction of monetary policy.

However, it is important to note that despite the strong market reaction, the Fed's actual policy decisions will still depend on the economic data performance over the next few months. Investors and analysts will closely monitor key indicators such as employment, inflation, and overall economic growth to assess whether the Fed will indeed take action in September.

Powell's speech undoubtedly injected new uncertainty into the financial markets, while also providing important clues for the direction of economic policy in the coming months. Regardless of the final outcome, this speech will be viewed as a significant turning point in the discussion of monetary policy in 2023.