Powell’s average address

Friday 28th August 2020Jerome Powell used his virtual address to the Jackson Hole Symposium to announcer the Fed’s strategy of targeting an ‘average’ 2% inflation rate, a subtle change that is likely to keep interest rates lower for longer. NAB’s David de Garis says that lower rates will help to propel investment once confidence returns, but it’ll take a while to eat into the current spare capacity. Meanwhile another million people signed for unemployment benefit in the US, business confidence seems to be picking up in Europe and the ABS provided confirmation that private capex in Australia was way down in Q2. Of course, the Q3 numbers will be a lot more interesting.

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