Federal Open Market Committee (FOMC) Chair Powell is speaking this week at the Kansas Fed’s Jackson Hole symposium.
Previews posted:
- Previewing the week ahead in financial markets. TL;DR version is NVDA earnings vs. Powell
- Goldman Sachs is not expecting a strong signal from Federal Reserve Chair Powell this week
This
summary of a TD note previewing the speech is via the folks at eFX.
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TD Securities anticipates Federal Reserve Chair Jerome Powell’s upcoming address at Jackson Hole, centered on the theme ‘Structural Shifts in the Global Economy’, to be of significance for the broader economic community and the markets.
Key Expectations:
1. Shift in Policy Guidance: TD believes this event presents an opportune moment for Chair Powell to introduce a transition in the Fed’s policy direction. Instead of emphasizing the number of anticipated hikes, Powell might pivot to a narrative where the spotlight is on interest rates remaining ‘higher for longer’.
2. Relevance of the Theme: The theme of ‘Structural Shifts in the Global Economy’ could provide a backdrop for Powell to delve deeper into the changing dynamics of global economics, especially in the post-pandemic world, and how they influence the US economic outlook.
Implications: If Powell does hint at a ‘higher for longer’ stance on interest rates, it could signal a more hawkish approach by the Federal Reserve in the foreseeable future.