Today was always going to be an interesting day as investors have been waiting all week. Jerome Powell just started speaking at the Jackson Hole (at 14:10 BST) so it will be very interesting to see how today’s session evolves this afternoon. Into the speech, our pad is slightly skewed to the sell side and the selling has been split between defensives and cyclicals. Volumes pretty mixed (+25% vs 1d, -15% vs 20d AVAT) but I wouldn’t describe it as a busy morning flow wise (suggesting today’s vols “pick up” is probs mostly futures action and quant funds?). In terms of the Speech itself, expectations have been for Jerome to move towards average inflation targeting, which would fundamentally change the relationship between inflation and interest rates and open the door to sustained Fed intervention in markets even in the face of rising inflation. For now let’s listen to him…
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