Weekly Wrap – Powell delivers

Powell sends dovish taper warning

Stock markets are enjoying a strong end to the week after Jerome Powell told investors exactly what they wanted to hear at the virtual Jackson Hole event.

Powell made clear some important points that gave investors the comfort they craved. Most notably that tapering and interest rates are not linked, which is very important if the Fed wants to avoid a mini taper tantrum when they do pull the trigger in the coming months.

The message from Powell was effective that the plan is still to taper this year, substantial progress has been made, downside risks are still apparent and inflation still looks transitory.

Even if the announcement does come in September, I wouldn’t expect the tapering will start until December. But that won’t matter because until the data starts to tell a different story, the path of interest rates will not be altered.

Ronaldo gives me a reason to write about football

It would appear it’s not just fans that get excited about transfers.

Manchester United’s share price is up more than 6% and even surpassed 10% at one stage today as the club completed the unexpected signing of club legend, and one of the best players to ever play the game, Cristiano Ronaldo.

The move appeared to come from nowhere just as he appeared to be signing for another club, United’s city rivals no-less, and investors have given their stamp of approval.

At the age of 36, he may not produce on the pitch what he was capable of when he left but there’s no doubt his brand and the impact he could have on the rest of the team, club and fanbase is significant.

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