Powell speech, August doldrums

Next week the major public policy event will be in Jackson Hole, Wyoming where Chair Powell is scheduled to give a major policy address.

Over the years the gathering at Jackson Hole, organized by the Kansas City Fed, has become the spot for major addresses by Fed Chairs. As is the case most years the FOMC is not having an August meeting, so the Chair’s speech replaces his post-FOMC press conference. Powell speaks next Friday, and much attention will be paid to his remarks.

Under Powell the Fed has done a good job of telegraphing policy decision, which adds importance to the Jackson Hole speech. Several Fed presidents have been speaking out in recent days, and there seem to be signs that more interest rate increases are coming, along with increasing speculation that the September meeting may see a step back to a 50-bp move rather than a third 75-bp increase. The Chair has been clear that rate decisions will be data-driven, and with the next meeting nearly a month away, there is much more data to come between now and September 20/21.

Looking Forward

The US has moved towards the European model where things really slow down in August. After a busy first two weeks with Congress passing the $750B Inflation Reduction Act, most key players have left DC and things have slow...
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