**Fed Chair Jerome Powell Hints at Rate Cuts, Markets Celebrate**

Federal Reserve Chair Jerome Powell just gave both Wall Street and everyday investors something to cheer about. In a highly anticipated speech at the Fed’s annual Jackson Hole conference, Powell suggested that interest rate cuts could come as early as September. This marks a major shift in tone from the Fed, which had previously focused on keeping rates high to fight inflation.

Powell said the economic outlook and changing risks may soon justify a change in policy. In simple terms, the Fed is now leaning toward making borrowing cheaper — a move that could boost spending, investment, and financial markets.

**Markets React Instantly: Stocks, Crypto Soar**

Investors didn’t wait to react. Stocks surged following Powell’s remarks. The Dow Jones jumped 2%, hitting new record highs above 45,680. The S&P 500, tracked by the Vanguard S&P 500 ETF (VOO), rose 1.4%, while the Russell 2000 — which tracks smaller companies — shot up nearly 4%, its best day since April.

Bond yields dropped sharply as traders bet on a September interest rate cut. The 2-year Treasury yield fell by 10 basis points to 3.70%, reflecting growing confidence that the Fed will ease policy soon.

Meanwhile, the cryptocurrency market exploded higher as investors embraced the risk-on mood. Bitcoin (BTC) surged 3.5%. Ethereum (ETH), Solana (SOL), and Cardano (ADA) saw even bigger gains — all rising more than 10% on the day.

**Economists Now Expect Multiple Rate Cuts**

Top economists across Wall Street are now predicting more than just one rate cut. Many believe Powell’s comments were a clear signal that the Fed is ready to change direction.

Goldman Sachs’ chief economist Jan Hatzius expects a 25-basis-point cut in September, saying Powell’s speech matched their expectations. He added that with the job market cooling down, the Fed has enough reasons to begin cutting.

Jeffrey Roach of LPL Financial said Powell’s new focus on current economic data — rather than past inflation — is a welcome shift for markets. David Laut at Abound Financial agreed, noting that just one more weak jobs report could lock in a September cut.

Chris Zaccarelli from Northlight Asset Management called Powell’s speech unusually clear. “He didn’t say it outright, but it’s obvious the Fed is preparing to cut rates,” he explained. According to Zaccarelli, unless we get unexpectedly strong data soon, the Fed is very likely to act in September.

Paul Stanley at Granite Bay Wealth Management pointed out that while it’s still unclear whether the Fed will cut by 25 or 50 basis points, the fact that they’re even discussing rate cuts again is bullish news for stocks.

Ryan Sweet at Oxford Economics went even further, predicting two rate cuts before the end of the year — one in September and another before December. He believes Powell is now focusing more on supporting jobs and economic growth than fighting inflation.

Technical analyst Larry Tentarelli of Blue Chip Daily said this shift benefits specific sectors like homebuilders, small-cap stocks, and regional banks — all of which rallied after Powell’s speech. He believes this could signal a change in which types of stocks lead the market going forward.

**Why This Matters for Everyday People**

When the Fed cuts interest rates, it lowers costs across the board. Mortgages get cheaper, credit card interest rates fall, and businesses find it easier to borrow and grow. That usually leads to more spending, stronger job growth, and rising stock prices.

For regular investors, this shift in Fed policy could open up new opportunities. Sectors like housing, small caps, and regional banks tend to perform well when interest rates go down.

**Key Takeaways:**
– Jerome Powell hinted strongly at a September rate cut.
– Stock markets hit new highs; crypto markets surged even higher.
– Wall Street now expects multiple rate cuts before year-end.
– Lower interest rates make borrowing cheaper and often boost economic growth.
– Investors may want to watch housing, small-cap stocks, and banks for potential gains.

If you’ve been waiting for a sign to re-enter the market or reposition your portfolio, Powell may have just given it.