- US/Eurozone: Fed Chairman Kevin Warsh’s Jackson Hole keynote speech on Friday remains the most important event this week; the symposium is viewed more as a credibility event rather than a rate-signalling one
- South Korea: BOK raised its policy rate for a second consecutive meeting to 3% as expected, alongside an upgrade in 2026 and 2027 GDP forecast to 3.3% and 2.9%, respectively
- Thailand: We expect BOT to stay on extended pause given the low and uneven pace of economic growth and headline inflation remaining within the central bank’s target range
- India-North Asia: India’s deeper ties with North Asia will mark a step towards technology-focused integration; China, HK, and Japan dominate the region’s trade linkages; Taiwan carries the most potential
Related Insights
US/Eurozone: Will Warsh align with Bessent? Fed Chairman Kevin Warsh’s Jackson Hole keynote speech on Friday, 28 Aug remains the most important event this week. The symposium is viewed more as a credibility event rather than a rate-signalling one. The decline in the 30Y yield over two days (24-25 August) serves only as a reprieve, not a resolution. US Treasury Secretary Scott Bessent’s decision to expand long-bond buybacks seeks to calm markets. Still, it raises questions about the line between liquidity management and the Fed’s monetary policy, complicating Warsh’s earlier willingness to let markets tighten financial conditions through higher long yields. Overall, Warsh faces a difficult balancing act: defending the Fed’s independence and price-stability mandate while providing greater clarity on the Fed’s reaction function without abandoning his preference for less forward guidance.
Meanwhile, the US Conference Board consumer confidence report was distinctly soft. The headline index fell to 89.4 in August, below the 90.2 consensus and July’s downwardly revised reading of 90.2 (from 90.8). US consumers turned more cautious following the surprise decline in July’s retail sales. They were also less confident about future employment prospects, consistent with July’s negative nonfarm payrolls.
US core PCE inflation, released 26 Aug, rose 0.2% m/m and 3.3% y/y in July, matching market expectations, whilst headline PCE inflation came in firmer than expected at 0.2% m/m and 3.7% y/y (consensus: 0.1% and 3.6%). Second reading on US GDP remained unchanged at 1.5% q/q annualised growth while consumer spending stalled in July with 0.0% m/m real personal spending. That said, markets continue to fully price in a Fed rate hike of 25 bps by December, while we expect no rate hike through the remainder of this year.
For Eurozone, Germany's economy grew at 0.3% q/q in 2Q26, faster than initially indicated (0.2%). Its leading indicator, the ifo Business Climate index, rose for a fourth consecutive month to 88.8 in August from July’s 86.7, posting the highest figure since Aug 2025. Both the current assessment and expectations improved significantly. The data suggests Germany’s economy is weathering tariffs, geopolitical tensions, and the energy shock better than expected, although the downside risks remain on persistently elevated oil and gas prices.
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