Online Reporter
A big week is coming up for the Federal Reserve and central bank enthusiasts.
The Kansas City Fed’s annual Economic Policy Symposium kicks off Thursday evening in Jackson Hole, Wyoming. Chair Jerome Powell in remarks on Friday is expected to unveil the Fed’s new policy framework — the strategy it’ll use to achieve its inflation and employment goals. Powell may also drop some hints about the Fed’s thinking ahead of its September policy meeting. Officials have left interest rates on hold so far this year as they wait to see how the Trump administration’s tariffs impact the economy.
With inflation still above the Fed’s 2 percent goal and signs of a slowdown in the labour market, policymakers have become divided on when to resume rate cuts. Powell’s speech could give Fed watchers a fresh update on how much support there is to lower rates in September — at a time the Trump administration is piling on the pressure to start easing.
Data over the past week likely did little to shift opinions on inflation and the economy. The core consumer price index, which excludes food and fuel, rose in July by the most since the start of the year. Yet the cost of tariff-exposed goods didn’t rise as much as feared.
A separate report on wholesale inflation suggested price pressures on companies are mounting, however. And a fresh read on retail sales showed American consumers flexed a bit more muscle over the past two months, though a decline in sentiment pointed to anxiety about inflation and the job market.
The global nature of the Jackson Hole conference also offers an opportunity for Powell’s peers to express their support amid persistent criticism from President Donald Trump. Central bank independence is likely to be a topic on the sidelines of the confab.
A handful of economists will present new research papers during the meeting, and there’s usually a panel featuring heads of some of the world’s biggest central banks.
Elsewhere, central bankers in New Zealand are projected to cut rates in a bid to shore up the labour market. Inflation and retail sales data take top billing in the UK, while purchasing managers’ indices for economies across the world will help shed light on the impact of US tariffs. — Bloomberg
Online Reporter