On August 26, Fed Chairman Jerome Powell put on the war paint in his fight against inflation at a Jackson Hole speech that was short and pointed.
"While higher interest rates, slower growth, and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses," he said.
Contrast that with today's speech where he said, "we don't want to overtighten" and that slowing rate hikes at this point makes sense.
The results have been dramatic in markets. Sizeable declines in equities have completely reversed with the S&P 500 now up 1.9% and the Nasdaq soaring by 3.1%.
The dollar was bounced around by month-end flows today, including a strong bid into the London fix. That's now completely reversed in the other direction, with the dollar down by 1.5% against the Australian dollar and solid declines elsewhere as well.
Fed fund futures now price in an 89% chance of 50 bps at the December meeting. Notably, he left himself some wiggle room if economic data comes in hot, saying that the time to slow hikes may come as soon as December.
The terminal Fed top now sits at 4.95% from as high as 5.05% earlier today.