Jackson Hole Special Coverage Content

RoboForex comments on 2017 Economic Symposium at Jackson Hole:

Yesterday, they opened the symposium in Jackson Hole, Wyoming, the USA. As a rule, it was a pretty dramatic event, at least when the Fed was led by Ben Bernanke, who took a significant part in the financial world. However, after his resignation from the position, the event status declined. And now, in 2017, all this craze about the meeting of the leading monetary politicians is about to revive again.

It’s all about expectations. The focus of today’s symposium attention is the speeches to be delivered by Janet Yellen, the Chairwoman of the Federal Reserve, and Mario Draghi, the President of the European Central Bank. Investors hope that Yellen will provide any hints at when the regulator is going to slowdown the QE and continue tightening its monetary policy and conditions. In other words, everyone wants to know when exactly the Fed will start selling the US treasuries accumulated during numerous QE periods. These steps will directly influence the liquidity in the US monetary system. The less the liquidity, the better for the USD, because it will have an opportunity to get stronger based on this factor alone. In the perfect scenario for investors, it would be better to know and understand what the ECB is going to do with its own QE.

It appears that both the Fed and the ECB will be very careful in their comments today. After all, Jackson Hole is not the place where they make significant statements.

Right now, global capital markets are trading small volumes. The reason for that may be the summer season on stock exchanges, which is usually rather calm. Another reason is that investors hope to hear from Central Banks something really “game changing”. The chances are small, but they exist.

At the start of the Friday’s trading session, the EUR/USD is trading at 1.18, but later in the afternoon one might expect higher volatility between 1.1760 and 1.1875.

Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.