Federal Reserve's Jerome Powell announces new approach to stimulating US economy – business live

Rolling live coverage of business, economics and financial markets as investors anticipate new approach to inflationWhat to watch out for in Powell’s speech: inflation and yield curves Another 1m initial jobless claims in US; US GDP contraction revised Stock markets move lower ahead of Jackson Hole speechRolls-Royce loses record £5.4bn in first half, seeks £2bn sales 2.53pm BST If we can keep the disease under control we can help the economy to recover, Powell says.But we need to support workers in sectors that are most affected, Powell says. There might be “stop and starts “ in general recovery, but there could be a “long tail” of people who are left out for at least a couple of years, he says. 2.49pm BST Some responses from economists and commentators:Even more central bank stimulus: That’s what #markets–across the board–have taken away, at least for now, from #Fed Chair #Powell’s remarks on changes to the #MonetaryPolicy framework. With that, the initial reaction is a la #MMT: higher prices for #stocks, #bonds, #gold, etcPowell speech: Implication for stocks. Stock traders have fairly straightforward view of Fed changes:1. Low unemployment not spurring inflation2. Rates lower for longer3. May have higher levels of inflation without Fed raising rates4. Positive for stocks@CNBCAnother comment about the new Fed policy strategy and Powell’s Jackson Hole speak: I am struck by how effective communicator Powell is. He is able to explain the framework, which some expected to be a major communication challenge, in simple straightforward terms. Continue reading…
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