- Jackson Hole speech sent Wall Street to fresh highs
- Tapering could start this year, but there is no sign or urgency
Wall Street stocks rallied to fresh all-time highs on great breadth (470-30 advancers to decliners) whilst bond yields and the US dollar dropped as Fed chair Jay Powell gave a clear signal that the US central bank is not in a tearing hurry to taper bond purchases – or raise rates. And in fact it could be the push back on the hiking rather than taper timeline that is more important for the market reaction right now. Gold also rallied as yields and the dollar lost ground, offering support to the metal, before retracing a chunk of the move back to $1,800.
In a speech that mentioned inflation 82 times, Powell sought to explain over and over why inflation remains transitory. Methinks he doth protest too much, springs to mind.