How to "understand" this week's most important meeting? Goldman Sachs presents: "Jackson Hole Central Bank Annual Meeting" Viewing Guide

The annual global central bank event - the Jackson Hole Economic Policy Symposium is about to kick off! Goldman Sachs has released a comprehensive "Jackson Hole Central Bank Symposium" viewing guide, focusing on three key moments in the conference schedule, as well as Jerome Powell's speech and media interviews with off-site officials.

On August 18, according to news from the Wind Trading Desk, Goldman Sachs stated in its latest research report that the annual global central bank event, the Jackson Hole Economic Policy Symposium, is about to open. Federal Reserve Chairman Jerome Powell will deliver a key keynote speech at 10 PM Beijing time on August 22, and the market expects him to comment on the current economic outlook and the review of the Federal Reserve's monetary policy framework, which may set the tone for the direction of monetary policy for the remainder of the year.

Powell's speech is titled "Economic Outlook and Framework Review," and will discuss the contents of the Federal Reserve's monetary policy framework review. According to Goldman Sachs' analysis, the Federal Open Market Committee may adjust its consensus statement, at least partially reversing the changes made in 2020, and may return to a flexible inflation targeting strategy as the main approach. The last framework review results were announced in 2020 at Jackson Hole.

European Central Bank President Christine Lagarde and Bank of England Governor Andrew Bailey will participate in the closing panel discussion on the early morning of August 23. Since most of the conference content is not broadcast live, about five Federal Reserve officials are expected to be interviewed by the media on August 22, becoming an important channel for the market to obtain policy information.

Historical data shows that this meeting, regarded as the most important global central bank policy barometer aside from interest rate decisions, has historically driven exchange rate fluctuations significantly beyond other periods in August.

Core Schedule: Three Key Moments

According to Goldman Sachs' research report, the complete conference schedule will be released at 8 PM Eastern Time on Thursday (8 AM Beijing time on Friday, August 21).

Goldman Sachs specifically pointed out that the core arrangements of the Jackson Hole Symposium include three important segments. First is the keynote speech at 10 AM Eastern Time on August 22 (10 PM Beijing time on August 22), where Powell will deliver a key speech titled "Economic Outlook and Framework Review." This will be followed by a lunch speech on the same day, and the closing overview panel discussion at 12:25 PM Eastern Time on August 23 (12:25 AM Beijing time on August 24).

European Central Bank President Lagarde and Bank of England Governor Bailey will participate in the Saturday panel discussion. Historically, speeches during the Saturday discussion often closely align with previously expressed views and are more closely related to the conference theme, as policymakers recognize that the market is closed.

Goldman Sachs noted that complete papers and speech texts are usually released on the official website at the start of each event, but it is worth noting that the Bank of England has stated this year that it will not release any text content.

Powell's Keynote Speech May Focus on Current Policy

This year's conference theme is "The Transforming Labor Market: Demographics, Productivity, and Macroeconomic Policy," which will set the direction for research presentations but has little impact on off-site interviews.

Typically, the conference theme determines the direction of submitted papers and policymakers' panel discussions, but the Federal Reserve Chairman's keynote speech focuses more on current policy issuesPowell stated last year that his Jackson Hole speech "doesn't necessarily have to relate to the theme of the conference." He pointed out that he usually tries to give a speech focused on the current economic outlook and presents some higher-level points, such as what we have learned in recent times.

Goldman Sachs also noted that this year Powell will discuss the Federal Reserve's monetary policy framework review. The last review was announced in Jackson Hole in 2020.

Goldman Sachs economists pointed out that the Federal Open Market Committee may adjust its consensus statement, at least partially reversing the changes made in 2020. They also believe that the Federal Open Market Committee may return to a flexible inflation targeting regime (rather than a flexible average inflation targeting regime) as its main strategy.

Goldman Sachs emphasized that while Jackson Hole is one of many such events throughout the year and does not hold special importance in terms of academic influence, its opportunity for high-level policymakers to speak during the central bank communication lull in August still attracts close market attention to gain insights into the policy themes for the remainder of the year.

Media Reports: Off-the-Record Interviews Become the Focus

As most of the conference content is not broadcasted to the public, media interviews have become an important way to obtain policy information. Television coverage will begin on August 20, as attendees arrive in succession and continue until August 22.

According to Goldman Sachs analysis, typically about five Federal Reserve officials will be interviewed by different media on August 22, and sometimes one person will participate in multiple interviews. Federal Reserve Board officials usually wait until after the chair's speech to accept interviews. International central bank officials and scholars will also participate in interviews.

The President of the Kansas City Fed, as the host of the conference, may be interviewed before the meeting starts on August 20. Although speeches often have an academic tone, these interviews can sometimes be more relevant short-term news events of the day. It is important to note that many policymakers will attend the conference, and even if not on the official agenda, they may accept media interviews.

Notably, historical experience shows that interviews with central bank officials often reveal recent policy directions more than academic discussions. In 2014 and 2017, the euro's volatility triggered by ECB President Draghi's lunch speeches was comparable to that of the Federal Reserve Chair's opening remarks, highlighting the market influence of statements from international central bank officials