By Noreen Burke
Investing.com — In the week ahead, investors will focus on Federal Reserve Chairman Jerome Powell’s speech at the central bank’s annual meeting in Jackson Hole for insight on future interest rate path. The speech could shake markets, with U.S. stocks already showing signs of slowing. U.S. economic data will be in the spotlight as worries about the prospect of a recession linger. Meanwhile, PMI data from the euro zone and the UK are expected to point to a further slowdown in business activity. Here’s what you need to know to start your new week.
- Jackson Hole
Investors will eagerly await Jay Powell’s speech at Jackson Hole
, Wyoming sought possible answers on Friday about how high U.S. interest rates could get and how long it would take to keep inflation back under control.
The Federal Reserve has raised interest rates
Fed policymakers reiterated that their inflation battle still has some way to go, delaying expectations for a peak in inflation and a so-called dovish pivot that has helped lift stocks statement.
Last week’s Fed minutes showed that while the size of the September rate hike is still in play, policymakers believe that so far there is little evidence that inflation pressures are stabilizing.
Powell may remind investors that there is still time for officials with an inflation report and another jobs report ahead of the September meeting Decide how big the rate hike should be.
- US data
Economic calendar for the week ahead featuring July data Personal income and expenses , including individuals The Consumer Expenditure Price Index , the Fed’s preferred inflation measure.
During the months ending in June, PCE price index
Other data points include revised second quarter GDP
- data, which initially showed a contraction of 0.9%.
- and PMI data for July. Meanwhile, new home sales data will provide a clearer picture of a cooling housing market.
U.S. stocks have risen since the second half of the year, buoyed by stronger-than-expected corporate earnings and hopes that the economy will recover even if the Fed raises interest rates to curb inflation. to avoid recession.
Despite warnings from Fed policymakers that peaking inflation expectations and the central bank’s so-called dovish turn may be premature.
But the market went up anyway. There are signs that gains may be starting to slow after all three Wall Street indexes closed lower last week. S&P 10 fell about 1.2% and the Nasdaq fell 2.6%, both ending a 4-week winning streak. The Dow fell about 0.2% this week.
“As market participants start to return from the holidays, looking back…they will see that the central bank is nowhere near its goal of controlling inflation,” ING rates strategists said in a note to clients .
“This implies a continued struggle between central bank tightening expectations and recession fears.”
There will also be information on Durable Goods Orders , Initial Jobless Claims
Eurozone will release
- August PMI data will be released in July composite PMI below225 was closely watched , pointing to a contraction in business activity. PMI readings are expected to deteriorate again, while energy prices in the euro zone are still rising.
- UK PMI
The European Union will release Consumer Confidence Data late Tuesday in August, expected It will set a new all-time low after falling to an all-time low in July.
Market watchers will also focus on Thursday minutes of the ECB July meeting
UK will publish PMI on Tuesday data will be closely watched after the BoE warned earlier this month 15 – A one-month recession from the end of the year.
UK inflation hit .1% in July, the highest level since February
- , some economists expect the surge in energy Case, the first quarter of next year will reach 10%
last week’s data show , wages have lagged far behind price growth, and consumer confidence has fallen to record lows.
The Bank of England has raised interest rates six times since December, weighing on growth, but signs of expanding inflationary pressures prompted economists to raise their forecasts for further rate hikes.
–Reuters contributed to this report