The annual jamboree for central bankers at Jackson Hole, Wyo., is always a cause for considerable speculation in terms of clues that may be dropped as to future policy direction, particularly from the Federal Reserve.
Every word of the Fed Chairman address is keenly shifted, every nuance carefully weighed to see what clues it gives to future policy direction. This time is no different but markets have been curiously sanguine since last month after considerable volatility earlier in the year. The Vix volatility index slid to its lowest level last week since August 2014
That is peculiar because the direction of interest rates at the Fed has been the cause of considerable volatility for emerging market exchange rates, bonds and precious metals in recent years. (more…)