|Day's range||1.5720 - 1.6230|
|52-week range||1.4750 - 3.2480|
All eyes will be on Federal Reserve Chairman Jerome Powell Friday morning when he speaks at the Fed’s annual Jackson Hole Economic Policy Symposium.
Investors treated the Fed minutes as a non-event, choosing instead to shift their focus on Powell’s speech at Jackson Hole on Friday. The muted price action in all the final markets indicates some investor indecision and impending volatility. In other words, investors are keeping their powder dry.
Federal Reserve policymakers were deeply divided over whether to cut interest rates last month but were united in wanting to signal they were not on a preset path to more cuts, a message not likely to sit well with U.S. President Donald Trump. While a "couple" of participants favoured a deeper cut of half a percentage point to help lift inflation toward the Fed's target and thwart fallout from global trade tensions, a larger number - characterized in the minutes as "several" - favoured no change at all. The depth of the debate raises the stakes for the signal that Chairman Jerome Powell is set to deliver on Friday at the Fed's annual policy retreat in Jackson Hole, Wyoming.
A lot has happened since the Fed's last meeting where it lowered rates for the first time in over a decade. How will policymakers navigate communication at their annual summit in Jackson Hole this week?
At the Jackson Hole Economic Policy Symposium in 2014, Mario Draghi made a polite departure from the usual rhetoric around austerity, saying “it would be helpful” if fiscal policy could play a greater role, alongside monetary policy, in boosting demand. Five years later, central bankers meet again in Jackson Hole as Mr Draghi prepares to leave the European Central Bank. The issue at stake is that there is not enough monetary policy space to deal with the next downturn.
U.S. stocks rallied Monday morning in an at least temporary reprieve after a mid-August rout. U.S. government bond yields rose across the curve, led by yields on 30-year bonds and 10-year notes.
Powell will essentially have to talk tough in an effort to calm the financial markets. If he misses then he may actually trigger more volatility in the stock markets that could send investors back into the Japanese Yen for safety.
Gold could be under pressure this week if recession fears continue to subside. There aren’t many major economic events this week so if there is volatility, it will likely be fueled by unexpected events by China or the United States. The key market moving event could take place on Thursday when Federal Reserve Chairman Jerome Powell delivers opening remarks at the Jackson Hole Economic Policy Symposium.
Traders are focusing on two things: Possible OPEC production cuts and lower demand due to a weakening global economy. They don’t seem to be too worried about U.S. growth at this time. However, they are expressing concerns about the rising U.S. production.
U.S. President Donald Trump and top White House officials dismissed concerns that economic growth may be faltering, saying on Sunday they saw little risk of recession despite a volatile week on global bond markets, and insisting their trade war with China was doing no damage to the United States. "We're doing tremendously well, our consumers are rich, I gave a tremendous tax cut, and they're loaded up with money," Trump said on Sunday.
Former NFL player Jack Brewer has launched a career development course for inmates preparing for transition into the workforce.
The yield curve inversion had markets tumbling amid concerns of a coming recession, but what is a "yield curve" and how (and/or why) does it invert?
Plunging Treasury bond yields spooked a lot of investors this past week, especially after the yield on the 10-year Treasury briefly fell below that of the 2-year for the first time in more than a decade. That so-called inverted yield curve has preceded each of the last seven recessions. But Scott Ladner, chief investment officer at Horizon Investments, tells Yahoo Finance that the U.S. stock market shouldn’t necessarily be taking its cue from the bond market right now. That’s because about $17 trillion of government bonds worldwide are trading at negative yields, according to Bloomberg.
U.S. homebuilding fell for a third straight month in July amid a steep decline in the construction of multi-family housing units, but a jump in permits to a seven-month high offered hope for the struggling housing market. Declining mortgage rates have done little to stimulate the housing market as land and labor shortages constrain builders' ability to construct sought-after lower-priced homes. "After almost a year, lower mortgage rates have done nothing to boost residential housing construction," said Chris Rupkey, chief economist at MUFG in New York.
U.S. homebuilding fell for a third straight month in July amid a steep decline in the construction of multi-family housing units, but a jump in permits to a seven-month high offered hope for the struggling housing market. The housing market has not benefited much from declining mortgage rates because of land and labor shortages, which are constraining builders' ability to construct sought-after lower-priced homes. Housing starts dropped 4.0% to a seasonally adjusted annual rate of 1.191 million units last month, the Commerce Department said on Friday.
Gold is going to have a hard time mounting a rally on Friday as long as yields remain firm, investors are willing to take on risk and the dollar continues to strengthen. It looks like it is going to take a surprise event to turn the market around today.
Global stock markets looked set to end a turbulent week on a positive note although worries about the U.S. economy and the trade conflict between the U.S. and China still have the potential to derail Friday's recovery. Add in worries over the trade conflict between Washington and Beijing, Brexit, weak economic performance in Germany and political unrest in Hong Kong and stock markets have endured one of their worst weeks this year. "Exhausted traders the world over head into the weekend in a more buoyant mood," said Craig Erlam, senior market analyst at OANDA.