The Biden administration is maintaining a positive outlook on the economy, as conversations with regulators and market participants indicate that the underlying economy remains healthy. Despite Monday's global market rout, which saw significant declines, reports back to Washington suggested that the situation was within normal parameters. There were no reports of bank failures, central bank interventions, or signs of systemic risk spreading through the international financial system.
On Tuesday, US stocks were poised for a rebound, with Dow futures up 170 points and S&P 500 and Nasdaq futures showing a 0.8% increase. Japan's Nikkei index also saw a significant rise of 10% following the crash on Monday.
While the recent market volatility does not warrant an emergency meeting by the Federal Reserve, attention is now turning to an upcoming speech by Fed Chair Jerome Powell scheduled for August 24 at the central bank's annual Jackson Hole, Wyoming, meeting. Market expectations are high for Powell to outline a clear roadmap for potential interest rate cuts in the coming months, especially in light of data showing a more significant slowdown in hiring and wage growth than initially anticipated.
