Below are a few charts worth reviewing as we await the Jackson Hole meeting.
Investors will be paying attention to among other topics; inflation outlook, balance sheet development, emerging markets bonanza, Powell etc.
The USD has been trading relatively strong since April despite the recent pullback. Note the DXY index is down to the 50 day average here.
Let’s see if the brutal moves in Emerging Markets will affect what Fed thinks about the economy. Below JPM emerging market FX implosion.
Fed Balance sheet continues the outlined path.
Markets expect the Fed to hike rates for the third time this year, but a December move is definitely not as likely. I guess the world will be twisting Powell’s wording “for now”. Below image of Fed dots.
Source: charts by Bloomberg