Entering The Worst Seasonal Period Of The Year... Which Ends With Jackson Hole

A notable addition was August 2019 when we saw the 2s10s yield curve invert for the first time in the cycle which alongside an escalation in the US/China trade war, encouraged declines as well.

So, what could this August bring, the strategist asks and observes that according to the bank's June monthly survey, more people are planning to take holidays this (northern hemisphere) summer than in a normal year so liquidity will likely be even lower than usual.

In terms of events, the August focus will be on Jackson Hole, China’s ongoing regulatory crackdown, and the Delta variant amongst all the usual macro variables, especially inflation.

His advice to traders: "enjoy your holidays if you’re off but keep half an eye open for any surprises in what are likely to be thin markets."

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