Powell faces economic and political fear at Jackson Hole

Federal Reserve Chair Jerome Powell will address the Jackson Hole Economic Symposium on Friday, in what is widely expected to be his last speech as head of the central bank.

The long-standing central banking conference happens from August 21-23 and brings together experts, including economists, academics, finance heads, and US government representatives, to discuss the Fed’s long-term strategy.

Powell’s speech comes amid a divided Fed on interest rates, President Donald Trump’s pressure to increase rate cuts, and mixed economic data.

The Fed held rates steady in July, with two dissenting votes. For four years, inflation has consistently overshot the central bank’s 2% target, and fresh data hints it may be rising again, while the labor market shows signs of weakening.

Economists warn that the situation looks like the early stages of stagflation, a mix of weak growth and rising prices, which has not been seen in decades.

President Trump has slammed Powell for keeping rates elevated, blaming him for a struggling housing market. Yet Trump’s sweeping tariffs are affecting the prices of goods.

Powell is caught between two risks: holding rates too high and risking recession, or cutting too soon and reigniting inflation. Some economists say there may be more rate cuts this year.

Speculation about Powell’s successor also looms large.