Economic data used to be everything but nowadays, writes Neil Birrell, guidance from central bankers - what they say as much as what they do - drives asset prices in the short term and sets strategy for the medium term
‘Back in the day', as the modern vernacular has it, economic data was everything. Fund managers huddled around their Reuters screens and trading floors fell silent as the non-farm payroll number was announced or the UK RPI rate was released. Historic data is still vital and informative but forecasting has become industrialised and more accurate and so forward-looking indicators have become more important in the decision-making process of investors. Nothing more so than the guidance provided by central bankers: the language used by Jerome Powell in his post-Fed meeting press conferences, ...
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