Central bank chiefs, including European Central Bank President Mario Draghi and Federal Reserve Chair Janet Yellen, are convening in Jackson Hole, Wyo., this week with two issues high on the agenda. Despite general growth worldwide, inflation remains low and delegates will explore the reasons while keenly awaiting Draghi's scheduled speech, which may give some indication of a move toward tapering the ECB's stimulus scheme.
The EU must assume greater responsibility for defense, European Commission President Jean-Claude Juncker said. "It becomes clear that we cannot, in the long term, rely on American defense support," he said.
A National Association for Business Economics survey found that only 17% of the economists polled expect Federal Reserve Chair Janet Yellen to be nominated for a second term. Of those expecting Yellen to be replaced, 49% expect White House economic adviser Gary Cohn to be tapped for the position.
Colin Cieszynski, CFA, CMT, of CMC Markets finds gold currently testing the top of the $1,200 to $1,300 range that has been in place for the last four months. This test could end in a major breakout and the start of a new upleg, or a triple top and the start of another downswing. US domestic and international political turmoil plus the Federal Reserve's conference in Jackson Hole, Wyo., could keep gold and the US dollar active through this technically critical week.
Technical analyst Max Ganik writes that the Chicago Board Options Exchange's Volatility Index -- widely known as the "fear index" -- is approaching its highest level this year, while the Standard & Poor's 500 index could be about to test support at 2,440 and a break below could lead to a significant fall. Ganik attributes investor nervousness to recent geopolitical tensions and fading confidence that the Trump administration will carry out its promised economic reforms and spending plans.
The Securities and Exchange Commission is dropping civil charges against Javier Martin-Artajo and Julien Grout, two former JPMorgan Chase traders connected with the 2012 "London whale" incident that cost the bank $6.2 billion. Sources said the case -- the last of the traders charged -- was dropped because recent statements by the witness posed problems.
UK Prime Minister Theresa May's government plans to continue publishing papers this week explaining its negotiation positions on Brexit issues. The initiative comes as media reports indicate that cabinet ministers are worried about the slow progress of Brexit talks with the EU.
A number of banks have published their research costs in the past month as they comply with the unbundling and transparency requirements of Europe's revised Markets in Financial Instruments Directive. The figures show a wide divergence, with JPMorgan Chase charging as little as $10,000 for basic equity research, French lender Credit Agricole seeking as much as $137,000 a year, and Barclays' fees possibly reaching as high as $464,000.
Uncertainty continues over Deutsche Bank's plans to obtain a waiver from the European Central Bank and German financial regulator BaFin that would enable it to use capital from its Postbank subsidiary to finance potentially more lucrative activities that are also riskier. The bank appeared to change tactics in recent months, to announcing it will await full regulatory approval of its merger with Postbank, instead of actively seeking the waiver that would allow it to access Postbank deposits.
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