This post previews Janet Yellen’s 26 August Jackson Hole appearance, and the likely market implications. The main points are: Recent FOMC mixed messages – Dudley’s/Fisher’s recent small hawkish drift versus Williamson’s/Bullard’s dovishness, reflecting the difficult issues confronting the Fed – underpin market confusion about Fed policy. Neverthless, markets remain sceptical about the likelihood of further US … More Yellen at Jackson Hole: Don’t Rock the Boat?
This post previews Thursday’s key MPC policy decision, minutes and Inflation Report, in light of the continued deterioration of UK survey indicators and the MPC’s surprisingly-cautious approach three weeks ago (see here for my arguments for a confidence-boosting risk-management initial 25 cut). Overall, while a 25bp rate cut seems inevitable there’s some danger of MPC’s overall package … More MPC: Immediate risk-management “sledgehammer” easing justified, although (tweaked) QE extension could be delayed until November so risk of £ short squeeze