A must read piece from Tim Duy: Heading Into Jackson Hole
Bottom Line: Anything other than a dovish message coming from the Jackson Hole conference will be a surprise. Tight labor markets alone will not justify an aggressive pace of tightening. An aggressive pace requires that those tight labor markets manifest themselves into higher wage growth and higher inflation. Yellen seems content to normalize slowly until she sees the white in the eyes of inflation.
CR Note: Yellen will be patient.
Wednesday:
• At 7:00 AM ET, the Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.
• At 8:30 AM, Retail sales for July will be released. On a monthly basis, retail sales increased 0.2% from May to June (seasonally adjusted), and sales were up 4.3% from June 2013. The consensus is for retail sales to increase 0.2% in July, and to increase 0.4% ex-autos.
• At 10:00 AM, the Manufacturing and Trade: Inventories and Sales (business inventories) report for June. The consensus is for a 0.4% increase in inventories.