Photo: Eric Piermont/AFP/Getty Images

In one of his final speeches before a big policy meeting this month, Fed Chair Jerome Powell gave another hint that a rate cut is coming and stressed the importance of communicating frankly with the public.

Why it matters: The financial markets may have backed Powell into a corner to cut interest rates, but these days Main Street has his ear, too.

  • In a novel series of public forums held the past few months, community leaders across the country have told Fed officials about the unevenness of the economic recovery.
  • Since the latest "Fed Listens" event in Chicago, Powell has referenced this grassroots feedback in nearly every single public appearance to underscore the importance of extending the record-long economic recovery.

What he's saying:

Gone are the days when the Federal Reserve Chair could joke, as my predecessor Alan Greenspan did, "If I turn out to be particularly clear, you've probably misunderstood what I said." Central banks must speak to Main Street, as well as Wall Street, in ways we have not in the past, and Main Street is listening and engaged.
— Powell's speech Tuesday at G7 Bretton Woods in Paris

The big picture: Powell, who is more plainspoken than his predecessors, has emphasized the importance of forthright communication since he took the helm of the Fed. He has doubled the number of post-policy meeting press conferences, and, under his direction, the Fed is for the first time publicly reviewing the way it communicates — among other things — to carry out its mandates.

  • Powell has picked up on "the strong sense of transparency" carried out by Janet Yellen and Ben Bernanke, former Fed economist Jeffrey Bergstrand tells Axios.
  • Yes, but: Powell hasn’t been without his own communication missteps. He "gives a little bit more color than his predecessors, and sometimes that can be risky," says Michael Reynolds of investment management firm Glenmede Trust. "There were slip-ups like, 'we're a long way from neutral.'"

The bottom line: In the midst of the longest expansion on record, the central bank is about to make a move that is normally done only in dire economic situations. This will leave the Fed with less flexibility if a recession does come — setting up a situation in which communication is more important than ever.

  • "Powell has done a good job conveying they are pursuing a little bit of insurance," says Bergstrand.

Go deeper: The case for a Fed rate cut

Go deeper

Updated 34 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Politics: The swing states where the pandemic is raging. Ex-FDA chief: Pence campaigning after COVID exposure puts others at risk — Mark Meadows: "We are not going to control the pandemic"
  2. Health: 13 states set single-day coronavirus case records last week — U.S. reports over 80,000 new cases for second consecutive day.
  3. Education: The dangerous instability of school re-openings.
  4. World: Australian city to exit one of world's longest lockdowns — In photos: Coronavirus restrictions grow across Europe
  5. Media: Fox News president and several hosts advised to quarantine after possible COVID-19 exposure
  6. Nonprofit: Rockefeller Foundation commits $1 billion for COVID-19 recovery
Erica Pandey, author of @Work
1 hour ago - Economy & Business

The dangerous instability of school re-openings

Illustration: Eniola Odetunde/Axios

Schools across the country have flip-flopped between in-person and remote learning — and that instability is taking a toll on students' ability to learn and their mental health.

The big picture: While companies were able to set long timelines for their return, schools — under immense political and social strain — had to rush to figure out how to reopen. The cobbled-together approach has hurt students, parents and teachers alike.

Dan Primack, author of Pro Rata
1 hour ago - Politics & Policy

Trump doesn't have a second-term economic plan

Illustration: Aïda Amer/Axios

President Trump has not laid out an economic agenda for his second term, despite the election being just eight days away.

Why it matters: This is unprecedented in modern presidential campaigns, and makes it harder for undecided voters to make an informed choice.

Get Axios AM in your inbox

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Subscription failed
Thank you for subscribing!