As the Dow Jones scrambles to move past last week’s roller-coaster, scrutinize the Fed minutes for proof of a dovish rebellion. | Source: ANDREW CABALLERO-REYNOLDS / AFP
By CCN Markets: The Dow Jones looked dead and buried last week after a devastating 800 point decline, but an end-of-week recovery left the stock market on relatively steady footing heading into the second half of August.
If Dow bulls are going to get what they want, Wednesday’s FOMC minutes may prove insightful.
Should there be rumblings of dovish rebellion at the US central bank, Fed Chair Powell could tailor his comments as such at Jackson Hole. It’s also plausible that an ECB style trap is being laid so that the Fed can provide a Draghi-esque dovish surprise to get the Dow roaring again.
Whatever happens, investors should expect a tweetstorm from President Trump heading into the 23rd.
What Will Powell Say About the Economy?
US economic data continues to outperform the rest of the world, and core inflation data showed a second consecutive 0.3% bounce – the first in 18 years.
Given these fundamentals, Powell has shown reluctance to give the trade war too much credibility. The Fed chair’s statements at Jackson Hole could reflect this belief,