FTSE 100 Live: Energy price cap jumps 80%, Federal Reserve speech

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Powell speech in focus, FTSE 100 higher

A potentially market-moving address by Federal Reserve chairman Jerome Powell will today provide guidance on how the central bank intends to get inflation back under control.

Powell’s comments, which will be made to the Jackson Hole economic policy symposium in Wyoming at about 3pm UK time, are likely to dash any hopes that the Fed is ready to slacken its stance on tackling price pressures.

The hawkish message will point to interest rates staying higher for longer and suggest that a “neutral” level is far from the 2.5% seen by some on Wall Street in recent weeks.

Michael Hewson, chief market analyst at CMC Markets, said the Fed will want to be sure that inflation is falling at a sustainable enough pace before it signals any sort of dovish shift or pivot, especially if inflation turns out to be stickier than expected.

He added: “If inflation finds a base at a level which is still well above their 2% target it’s extremely unlikely the Fed will lean into any sort of guidance that suggests a rate cut is coming.”

Ahead of Powell’s address, CMC expects the FTSE 100 index to 23 points higher at 7,502 after a broadly flat session yesterday.

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