The Jackson Hole Symposium begins today with market participants curious to see if any indication on a September or even December hike in rates is on the cards. Will the momentum remain with the Bulls?
The Bears were happy to see the NASDAQ, S&P 500 and DJ 30 all close down yesterday, when intraday trading on the NASDAQ had it on route to a consecutive nine day gain. The reason for this was a very powerful Tweet by presidential candidate Hillary Clinton saying that there was no justification for the high prices being charged for EpiPens by health care company Mylan (NASDAQ:MYL).
This has us questioning if it really was the Tweet that did this or simply a lack of news in the market?
With some chief economists calling the Fed Symposium in Jackson Hole the most important event taking place all summer, the world’s economists and investors will be watching this small ski resort in Wyoming with bated breath.
With the most powerful central banker in the world, Fed Chair Janet Yellen going to speak on Friday, the markets are unnervingly quiet. Is this the quiet before the storm?
Some analysts are expecting her to air on the hawkish side in her speech relating to Septembers meeting. We can see why this may be the case, but we aren’t agreeing with them entirely.
If her past speeches are anything to go by, Chair Yellen never wants to take anything off the table. She may suggest that the employment and inflation targets have been hit, which could be seen as a signal to hike interest rates, but she has done this in the past without taking any action
Yellen knows that higher interest rates could seriously jeopardize what little growth the US economy actually has. And moving too early could be detrimental to the economy.