Fed Chairman Jerome Powell will have no interest in causing unrest or even panic on the capital markets. The Fed head is rather likely to try to cautiously prepare the markets for an imminent turnaround in monetary policy. In view of the economic outlook, which is fraught with great uncertainty due to the ongoing Corona pandemic, and the recent increase in indications of a weakening of the economic recovery, the Fed could well signal a continued wait-and-see attitude. Powell's highly anticipated speech is scheduled for 16:00 (CET).
And he New York Stock Exchange, investors were cautious before the speech by Fed Chairman Powell, as was to be expected. By the close of trading, the Dow Jones Industrial lost -0.54% and exited the day's trading at 35,213.12 points. The S&P 500 also closed -0.58% lower than the previous day at 4,470 points. On the technology exchange Nasdaq, the daily losses were also around -0.6%. On the Asian stock markets, the indices trended inconsistently on Friday and on Europe's stock markets, investors are likely to remain cautious ahead of the Fed Chairman's speech.
According to a revision, GDP growth in the US was slightly stronger in the second quarter at an annualized +6.6% than initially estimated at +6.5%. Economic growth thus accelerated slightly compared with the first quarter (+6.3%). The world's largest economy was supported in the second quarter primarily by private consumption, which grew at an annualized rate of just under +12%. However, bottlenecks in the supply of construction materials, which resulted in a significant decline in construction investment, had a negative impact.
According to the minutes of the European Central Bank’s last interest rate decision on July 22, published yesterday, there was broad agreement in the top monetary policy body that the inflation outlook had improved. However, risks to the inflation outlook in the near term “remain increasing and tilted to the upside.” However, the Governing Council will take another in-depth look at the outlook at its next meeting on September 9, once the new projections prepared by experts are available, the minutes said.
According to the latest results of the GfK Institute's monthly consumer survey, the mood of German consumers has deteriorated with a view to September. Accordingly, the GfK consumer climate index fell from minus 0.4 to minus 1.2 points. On the one hand, the uncertainty about the further development of the pandemic and, on the other hand, the increased inflationary pressure, respectively rising consumer prices, are burdening, commented the Nuremberg-based institute. Most recently, the inflation rate in Germany rose to +3.8%.
|08:00||AUT||GDP Q2 (q/q)||+4.3%|
|08:00||GE||Import Prices (July, y/y)||+12.9%|
|08:45||FR||Consumer Confidence (August)||101.0|
|10:00||IT||Business Climate (August)||116.6|
|14:30||US||Consumer Spending (July, m/m)||+1.0%|
|14:30||US||Personal Income (July, m/m)||+0.1%|
|16:00||US||Fed Governor Powell Speach Jackson Hole Symposium|
|16:00||US||Consumer Sentiment University Michigan||70.2|
|USA||Zoom Video Communications||Q2|
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Source: LGT Bank (Switzerland) Ltd.
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