Blog Post Date August 25, 2025
By Don Almeida- Mortgage Expert and President of Happy Home Mortgage
Market Highlights – What You Need to Know
1. Fed Chair Powell Signals Possible September Cut
At the Jackson Hole symposium, Jerome Powell suggested that the “shifting balance of risks may warrant adjusting our policy stance.” Translation: a rate cut could come as soon as September. His remarks focused on slowing job growth and potential labor market weakness, even as inflation remains a concern.
2. How Markets Reacted
- Stocks rallied: The S&P 500, Dow, and Nasdaq all surged on Powell’s dovish tone, with the Dow hitting fresh highs.
- Rate cut probability spiked: Traders are now pricing in a roughly 75%–90% chance of a 0.25% cut in September.
3. Dollar Weakens, Commodities Lift Off
The U.S. dollar slipped after Powell’s comments, while commodities such as metals and gold saw renewed gains.
4. Powell Stresses Data-Dependence
Despite the market optimism, Powell emphasized that the Fed will remain guided by incoming data. The September 5 jobs report and the September 11 inflation readings will be decisive for the Fed’s next move.
Why This Matters for Borrowers & Homebuyers
- Mortgage rates may ease: A Fed cut often translates into lower borrowing costs, improving affordability for both buyers and homeowners looking to refinance.
- Buyer confidence rising: If the Fed begins cutting, it could help sustain housing demand despite broader economic uncertainty.
- Still data-driven: The Fed won’t act blindly—so all eyes remain on jobs and inflation in the weeks ahead.
Bottom Line
Powell’s Jackson Hole speech marked a clear pivot toward easing. Markets are betting heavily on a September cut, but the Fed insists decisions remain data-driven. For homebuyers, the possibility of lower rates on the horizon is encouraging news—especially heading into the fall market.
Sources & Further Reading
- Reuters – Fed’s Powell opens door to September easing
- Financial Times – Wall Street’s September Fed rate cut bets still hinge on next data
- Reuters – Dollar struggles to recover from Powell’s dovish surprise
- Wall Street Journal – Stocks rally as Powell hints at potential cut
- Bloomberg – Industrial metals rise after dovish Powell signals Fed rate cut
