All eyes will turn to the mountains of Wyoming in this week for the Federal Reserve’s Jackson Hole symposium, your best chance every year to see a Nobel Prize-winning economist in a cowboy hat.
The highlight will come Friday, when Fed Chair Jerome Powell speaks about the economic outlook in a keynote address at 10am New York time.
With the US central bank approaching a crucial pivot point, it’s difficult to overstate how much attention financial markets will be paying.
For starters, they’re looking for confirmation the Fed will lower rates in September. But more drama surrounds what happens after that and the pace of additional cuts over the next several months as the Fed confronts the dual risks to both inflation and employment.
Bank of England Governor Andrew Bailey will also make and appearance on Friday, and Philip Lane, chief economist at the European Central Bank, will speak a day later. The conference is typically good for a torrent of additional commentary from a broad range of policymakers and economists.
Schedule details for the Friday-Saturday symposium will be made public Thursday evening local time.
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Just before the event kicks off, and also likely to attract scrutiny, the minutes from the Fed’s July 30-31 policy meeting will be released on Wednesday.
What Bloomberg Economics says
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“It’s highly likely Powell will use his Jackson Hole address to declare it will soon be the ‘appropriate’ time to cut rates. So attention will focus on a narrower question: Will he or won’t he signal an openness to a 50 basis-point move? We don’t think Powell will shut the door to a 50-bp cut, but he also won’t show any particular inclination toward it. That’s because policymakers likely haven’t reached a consensus on the urgency of cutting rates.” — Anna Wong, Stuart Paul, Eliza Winger, Estelle Ou and Chris G. Collins
Fresh figures on US housing demand, as well as weekly jobless claims, are the highlight of a lean week for US economic data.
On Thursday, the National Association of Realtors will issue data on previously-owned home sales, followed the next day by the government’s snapshot of new-home purchases. Both are seen showing modest increases, suggesting the residential real estate market is stabilising after a recent drop in mortgage rates.
On Wednesday, the Bureau of Labor Statistics is slated to release its preliminary benchmark revision estimate for payrolls in the year through March. The final figures are due early next year.
Photo and charts: Bloomberg
