Investors Look Toward Jackson Hole Key Speeches

August 23, 2023 21:24

There is little doubt that economists around the world are focused on the Jackson Hole Symposium. In a week that includes few significant releases and just a few days before autumn starts, the Federal Reserve’s annual meeting draws attention. Market analysts will be seeking clues regarding the Fed’s monetary policy as the Fed tries to bring down inflation figures.

The Jackson Hole Symposium Starts Tomorrow

The Jackson Hole Economic Symposium 2023 will run from the 24 – 26 August. Economists will be expecting to listen to the Fed’s head, Jerome Powell, remarks regarding the central bank’s monetary policy and how it is expected to influence the US economy in the next few months. However, Nomura’s analysts suggest that “despite the volume of Fedspeak that is likely to occur at the event, we think it is unlikely there would be much new guidance on near-term policy.”

It should be noted that the Fed minutes last week revealed that the majority of Fed officials were actually in favour of further rate hikes, suggesting that inflation remains unacceptably high, seeing "significant upside risks to inflation."

The European Central Bank’s (ECB) Christine Lagarde is also expected to attend the conference with some market experts suggesting that her speech might be even more interesting than Powell’s as the ECB tries to tackle elevated inflation.

On Tuesday, the Federal Reserve Bank of Richmond President Thomas Barkin said that “if inflation remains high and demand gives no signal it is likely to drop, that would require tighter monetary policy. Consumer spending, economic strength make it possible the US economy could reaccelerate before inflation cools.”

RBA Could Put Rates On Hold in September?

UOB analysts suggested in a note to investors that the Reserve Bank of Australia (RBA) could keep interest rates unchanged in its upcoming September governing board meeting.

The report noted that “the RBA has held rates unchanged for two consecutive months, and following the slew of data we think they will keep policy unchanged at its next two meetings on 5 Sep and 3 Oct, unless we get upside inflation surprises from Jul CPI data on 30 Aug and Aug CPI data on 27 Sep. However, we believe there is a chance it will hike one last time this year, taking the cash rate target to a peak of 4.35%. In terms of timing, this is likely to occur at the 7 Nov meeting, following the release of the 3Q23 CPI on 25 Oct.”

Tokyo CPI Inflation Report 

On Thursday, the Japanese Statistics Bureau will release its Tokyo CPI inflation report for the month of August. According to economists’ forecasts, Tokyo CPI inflation is likely to fall to 3% on an annualised basis. If confirmed the figure would be 0.2% lower when compared with July’s reading.  

Japan's core consumer prices rose 3.1% in July on a yearly basis, according to a report published by the Ministry of Internal Affairs and Communications. The core inflation index, which excludes food and energy prices, rose 4.3% year-on-year. The rise in the core consumer price index matched analysts’ forecast and followed a 3.3% increase in the previous month. 

Does trading on macroeconomic news interest you? Learn how this approach works with our free webinars. Meet and interact with expert traders. Watch and learn from live trading sessions.

Free trading webinars

Tune into live webinars hosted by our experienced traders

This material does not contain and should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments. Please note that such trading analysis is not a reliable indicator for any current or future performance, as circumstances may change over time. Before making any investment decisions, you should seek advice from independent financial advisors to ensure you understand the risks.

Miltos Skemperis
Miltos Skemperis Financial Content Writer

Miltos Skemperis’ background is in journalism and business management. He has worked as a reporter on various TV news channels and newspapers. Miltos has been working as a financial content writer for the last seven years.