HSBC: Jackson Hole is likely to be a non-event

Photo by Mark Wilson/Getty Images

If you’re expecting the the Jackson Hole Symposium to spark a bout of volatility in financial markets, prepare to be disappointed.

Here’s what Kevin Logan, chief US economist at HSBC, expects will come from the event (and for those frustrated by the tiny market movements this week, look away now):

We expect that the discussions will be mostly technical and have little immediate market impact. Financial markets will be focused instead on whether Fed Chair Janet Yellen will give any hints about the near-term outlook for Fed policy. In our view, she is likely to maintain a neutral stance, indicating that gradual increases in the federal funds rate would be appropriate if labor market conditions continue to improve and inflation moves closer to 2% as the FOMC expects. However, unless she specifies a time-frame for the next rate hike, her comments are unlikely to change market expectations that the chances of a rate increase at the September FOMC meeting are relatively low.

There’s a chance that Logan could be wrong, but he probably won’t be.

Apart from former US Federal Reserve chair Ben Bernanke hinting at QE2 (quantitative easing) at the Symposium in 2010, it’s been rare for any significant developments, at least for markets, to come from the gathering since.

It put the Symposium on the map, and still helps to create interest in the event some six years later.

After waiting for so long, and helping to drum up speculation in the process, it’s easy to see this year’s event being a disappointment.

If that is the case, don’t despair. It’s less than a week to the start of September, and a fresh deluge of economic data.

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