What to expect from Powell's speech?

Today, the head of the US Federal Reserve, Jerome Powell, will deliver a keynote speech at an economic symposium in Jackson Hole, Wyoming. Traders and investors are eagerly awaiting any clues he may give regarding the future monetary policy of the United States.

Earlier this week, a number of politicians softened some suggestions that the Fed is going to retreat from a multi-year campaign to raise interest rates. Officials express concern about high inflation (the main indicator of the monetary policy tightening cycle), which remains above the Fed's 2% target, despite a slight slowdown in growth. 

Moreover, the robust retail sales and consumer confidence figures also reinforce concerns that demand may not have slowed down enough yet to contain price increases.

Yesterday's economic statistics showed a slight decrease in initial applications for unemployment benefits in the United States, which indicates the stability of the labor market. At the same time, the volume of new orders for long-term goods, excluding defense, increased by 0.1% in July, which is an indicator of business investment.

Given that data was released on Wednesday indicating the lowest growth in business activity since February, it is important how Jerome Powell will interpret these mixed economic indicators, and how they may affect the future direction of the Fed's interest rate change.