The Jackson Hole Economic Policy Symposium, attended by academics, central bankers and market participants from around the world, starts today in Wyoming, USA. The symposium, which will be held under the title of "Re-Evaluation of Constraints on Economy and Politics", will last for two days. US Federal Reserve (Fed) Chairman Jerome Powell will also make a speech tomorrow as part of the symposium.
Despite the economic data that strengthened the recession concerns since the beginning of the week, Fed officials continued to make "hawkish" statements, while investors' expectations for more clarity on the size of the rate hike increased the importance of Powell's statements.
While Powell is expected to reiterate his commitment to reduce inflation, the probability that the Fed will raise interest rates by 75 basis points in September rose to 58 percent in money market pricing before the announcements.
While global markets have been exhibiting low risk appetite in line with weak economic indicators for a while, China's new 146 billion dollar stimulus package led to some revival in risk appetite.
The Chinese stimulus package revived the recently low risk appetite, especially in Asia Pacific. The MSCI Asia Pacific index rose 0.5 percent.
In Hong Kong, no trading took place in the morning due to the tropical storm warning, while Japan and China indices are green.
American futures are also up today. Nasdaq 100 and S&P 500 futures were up 0.3 percent. Even though the decline in US bonds before Powell was interrupted for a while, the 2-year yield is trading close to 3.40 percent and the 10-year yield close to 3.10 percent. The dollar is depreciating against many currencies today.
The State Council, which is the head of the executive in China, announced on Wednesday a 19-point policy package worth 1 trillion yuan ($146 billion). According to the package, 300 billion yuan will be provided to state banks to invest in infrastructure projects. Special bonds of 500 billion yuan will be provided to local authorities.
The data to be followed in the markets today are as follows:
09.00 Germany, 2nd quarter GDP
10.00 Turkey, August real sector confidence index
10.00 Turkey, August manufacturing industry capacity utilization rate
11.00 Germany, august Ifo Business Index
14.00 Turkey, PPK Meeting Summary
14.30 Turkey, weekly money and bank statistics
14.30 ECB meeting minutes
15.30 US, Q2 GDP
15.30 US, weekly jobless claims
15.30 US, Q2 personal consumption expenditures
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