Jackson Hole is on everyone’s mind
Good day. Investors say they are holding back from making new big bets while waiting for new ideas from Federal Reserve Chairman Jerome Powell on Friday at the Jackson Hole Economic Symposium, a forum Fed executives often use to announce significant changes. Goldman Sachs analysts believe the Fed will announce the start of a withdrawal of its $ 120 billion per month Treasury bond and mortgage purchases at the November meeting, and that a program cut will take place at a rate of $ 15 billion at each Federal Open Market Committee meeting. . This prospect is consistent, at least in part, with what many other analysts expect while awaiting Mr Powell’s speech. For now, analysts say, the Fed is still trying to build consensus among policymakers on the asset buying campaign.
Now on to today’s news and analysis.
Stock futures halt after S&P 500, Nasdaq hits records
U.S. equity futures wobbled on Wednesday, suggesting muted trading for indices a day after the S&P 500 hit its 50th record at the close of 2021.
Investors say they are delaying any further big bets until the end of the week as they await new ideas from Federal Reserve Chairman Jerome Powell. Fund managers are torn over whether the Fed will cut its bond purchases in the coming months, given the rise in Covid-19 cases and some signs that the economic recovery is slowing .
Derby’s point of view: Economists don’t expect a Powell Taper announcement this week
By Michael S. Derby
Federal Reserve Chairman Jerome Powell is unlikely to announce in his Jackson Hole Economic Symposium speech on Friday that the central bank is officially ready to begin withdrawing its stimulus efforts for asset buying, believe economists.
As Goldman Sachs economists put it in a note released Monday: “We believe that the [Federal Open Market Committee’s] the intention is to officially announce the start of tapering at the November FOMC meeting if all goes well by then, and to decrease at a rate of $ 15 billion per meeting.
Key developments around the world
House adopts $ 3.5 trillion US budget plan
The House narrowly passed a measure on Tuesday approving a $ 3.5 trillion budget plan and locking in a late-September vote on a roughly $ 1,000 billion infrastructure bill, ending a deadlock between a group centrist Democrats and their leaders on the party’s legislative platform.
Chinese factories have pain at work
Labor shortages materialize across China as young people shy away from factory jobs and more migrant workers stay at home, offering a possible glimpse of bigger challenges ahead as the workforce is aging and shrinking.
Outbreaks in poorly vaccinated Asian countries disrupt production
Outbreaks in Vietnam and elsewhere add to a long list of challenges – including epidemics at ports, shortages of freight containers and rising commodity prices – that companies face in delivering goods at low prices. cost and on time before the holiday season.
World Bank freezes aid to Afghanistan
The World Bank on Tuesday suspended funding for dozens of projects in Afghanistan, saying under its policies it cannot disburse funds when there is no agreement among its 189 member countries on legitimacy of a country.
Overview of financial regulation
Crypto measures in infrastructure bill risk pushing criminals deeper underground
Tucked away in a sweeping bipartisan infrastructure bill that was passed by the Senate earlier this month are measures meant to help deliver what many officials say is much needed regulation for the booming industry. boom in cryptocurrency. But some industry and national security officials warn the proposal could unintentionally push illicit cryptocurrency transactions into markets where the U.S. government has no reach, adding to the threat to businesses, government agencies. and American individuals.
Chinese internet companies try to win over Beijing and investors
After suffering stock sell-offs this summer, China’s internet giants are struggling to regain favor with global authorities and investors as companies try to chart a course back to normalcy.
TPG goes ahead with its initial public offering plan
TPG has hired JPMorgan Chase & Co. and Goldman Sachs Group Inc. to secure its planned initial public offering, people familiar with the matter say, bringing the private equity powerhouse closer to a milestone it has flirted with for years.
Wednesday (every hour ET)
8:30 am: US Department of Commerce releases July data on durable goods
Kansas City Fed Hosts Jackson Hole Virtual Economic Policy Symposium
Bank of Mexico releases August meeting report
7:30 am: European Central Bank publishes minutes of July 21-22 meeting
8:30 am: US Department of Commerce releases second estimate of second quarter GDP
11am: Schnabel from the European Central Bank speaks at a virtual roundtable on the ECB Strategy Review hosted by the German Ministry of Finance
Home builders are restocking their shelves
If homebuilders curb sales to build up inventory, sales are expected to increase significantly in the coming months, but if pricing is the problem, sales could remain in the doldrums, writes Justin Lahart.
Drought is exploding major cash crops in the United States, further raising the prices of staple foods, including corn and wheat, and prompting the USDA to lower its agricultural production expectations this year, which, in turn, leads to a decrease in national stocks.
President Biden and some Republicans in Congress say the need to be licensed to work in many different roles prevents Americans from taking well-paying jobs.
US manufacturing activity in the central Atlantic region lost momentum this month, following declines in other regional surveys, according to the Federal Reserve Bank of Richmond. The composite index of its fifth district survey of manufacturing activity fell to nine from 27 in July. (Dow Jones Newswires)
New home sales in the United States rose 1% in July from June at a seasonally adjusted annual rate of 708,000, the Commerce Department said, adding that sales fell 27.2% from the year before, when the reopening after the pandemic had caused an increase in transactions. (DJN)
North American cross-border freight increased in June, the Bureau of Transportation Statistics said, noting that $ 116 billion in cross-border freight was carried by all modes of transportation, up 41% from the previous year and 10% more than in June 2019. (DJN)
UK retail sales are on the rise, but supply chain disruptions and staff shortages caused by the pandemic and the UK’s exit from the European Union are increasing, according to the latest quarterly trades survey of the Confederation of British Industry distribution to 104 companies. It revealed that retail sales grew at the fastest pace since December 2014 in the year through August, while the increase in orders hit an investigative record. (DJN)
Mexico’s inflation rate eased in early August thanks to falling energy costs after the government capped the price of propane gas, lowering the consumer price index by 0.02% in the year. during the first two weeks of the month and reducing the annual inflation rate to 5.58% from 5.81% in July, according to the National Institute of Statistics. (DJN)
South Africa’s unemployment rate hit a record high of 34.4% in the second quarter of 2021, Statistics South Africa said, as the economic impact of the pandemic continued to put pressure on the world’s most industrialized economy. ‘Africa. (DJN)
German business sentiment deteriorated in August for the second month in a row, with supply chain bottlenecks and concerns over the Covid-19 Delta variant clouding the near-term outlook. The Ifo business climate index fell to 99.4 points in August from 100.7 points in July. (DJN)
(END) Dow Jones Newswires
August 25, 2021 09:07 ET (13:07 GMT)
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