This Friday, Beijing time, the annual Jackson Hole Global Central Bank Annual Meeting is about to be held. Federal Reserve Chairman Powell, Bank of England Governor Bailey, and others will give speeches and elaborate on the latest monetary policy intentions. At a critical moment when the Federal Reserve's monetary policy is about to shift, this meeting has attracted the attention of global investors.
Although the "Global Central Bank Annual Meeting" is well-known, many people are not familiar with its history. The reporter found that the official name of the "Global Central Bank Annual Meeting" is the "Economic Policy Symposium", and the organizer is not an international financial institution such as the International Monetary Fund or the World Bank, nor even the Federal Reserve, but the Federal Reserve Bank of Kansas City. It is one of the 12 regional reserve banks in the United States and, together with the Federal Reserve Board in Washington, forms the central banking system of the United States, known as the Federal Reserve.
Although it is not an official event, the history of the seminar has lasted for 45 years, and each year's theme is enough to attract investors' attention.
In 1978, the Kansas City Federal Reserve held its first seminar in Kansas City, Missouri, with the theme of "World Agricultural Trade: Growth Potential". Subsequently, in 1979 and 1981, seminars were held in Vail, Colorado and Denver, respectively, to conduct academic discussions on agricultural topics.
In 1982, the Kansas City Fed decided to hold the seminar in Jackson Hole, a resort town in Wyoming, which is also the origin of the conference name. The theme of that year was "Monetary Policy Issues in the 1980s", and then Federal Reserve Chairman Paul Volcker attended the meeting. Volcker stated at the meeting that he wanted to lower the inflation rate. At that time, the US CPI fell from nearly 15% to around 6%, but it was still at a historically high level.
In 1989, then Federal Reserve Chairman Alan Greenspan, along with representatives from the Bank of Canada and the Bundesbank, conducted a seminar on the theme of "Monetary Policy Issues in the 1990s". This is the first time that the Federal Reserve Chairman has played an international leading role at a seminar, initiating a trend that has continued to this day.
The theme of the 2007 seminar, "Housing, Housing Finance, and Monetary Policy," was once considered too boring and criticized by attendees. But by the time the seminar began in August, the US real estate market had already collapsed and triggered a global financial crisis. This has enabled the seminar to gradually step out of the ivory tower and study financial issues in the real world.
Although the Chairman of the Federal Reserve will not announce any changes in monetary policy at the seminar, investors still hope to extract enough information from the speech to analyze the direction of the Federal Reserve's monetary policy. In 2010, then Federal Reserve Chairman Bernanke proposed the option of further easing policy, which was seen as a signal of further quantitative easing; In 2012, Bernanke once again expressed "serious concerns" about the market and subsequently launched the third round of quantitative easing policy; The current US Treasury Secretary Yellen delivered a speech during her tenure as Chair of the Federal Reserve in 2016, preparing the market for more interest rate hikes. Subsequently, the Fed began raising interest rates in December 2016 and continued to do so until 2018.
Since Volcker, successive Federal Reserve chairmen, including Greenspan, Bernanke, Yellen, and Powell, have attended the annual meeting, gradually increasing its influence. Nowadays, annual conferences attract major central bank governors, fiscal officials, economists, renowned scholars, financial media, and others from around the world to gather together to discuss economic prospects and monetary policies. Therefore, the Jackson Hole Central Bank Annual Meeting is also known as the "Davos Forum of Central Bank Governors".
The theme of this year's annual meeting is "Re evaluating the effectiveness and transmission mechanism of monetary policy". This topic has been an important topic in the recent interest rate hike cycle, with recent research focusing on the impact of different mortgage market structures, increasing public debt, and the popularity of online banking services.
However, the value of this year's "Global Central Bank Annual Meeting" is slightly insufficient, with only the Chairman of the Federal Reserve and the Governor of the Bank of England confirming their attendance and delivering speeches. However, European Central Bank President Lagarde is not expected to attend this year's meeting, and will be replaced by European Central Bank Chief Economist Philip Ryan. And Bank of Japan Governor Kazuo Ueda, who attended the annual meeting last year, may be absent this year because he will attend a hearing in the Japanese Diet on August 23rd. Traditionally, there have been few central bank governors or senior officials in China attending the Jackson Hole Conference.
However, considering that every word and action of the Federal Reserve Chairman has a significant impact on the global financial markets, and that it is currently a sensitive period when monetary policy is about to shift, the progress of this year's meeting still attracts attention.