macroVS Episode 26 -- Reserve Currency Policy Pressures, quantified

The OTHER major central banking conference last week | De-coding the debate data regarding GDP Growth and Reserve Currency dynamics | Jackson Hole redux

Welcome to the macroVS podcast, your weekly weekend deep dive into the conversation central banks are having publicly. We use objective data generated directly from the public policy process to highlight signals and macro trends that go past the familiar inflation talking points to help global macro strategists connect the dots more effectively.

Many seek to use our data to gain immediately actionable informational advantages. This is fair.

Our published correlations analysis make clear that spikes in Action values in our data anticipate market volatility for a simple reason: we pick up the signal and share it with markets before the news cycle has published the story. Institutional news feed customers receive the most dynamic signals by programmatically measuring the size and duration of the informational advantage relative to specific stories in their news feed. Some users report that our data delivers roughly an 18-hour advance notice of market volatility in the EUR/USD markets.

Forthcoming analysis this month will show users how to use familiar market metrics (moving average analysis, relative strength index analysis) on our data to deliver more precise signals.

But today’s podcast focuses on medium-term macro policy shifts that matter to strategists.

The Federal Reserve’s Jackson Hole symposium traditionally delivers ideal fodder for macro trend analysis. Many were disappointed by the discussions this year. But if you use PolicyScope data as your starting point for discovery, a very different picture emerges. August again delivered major signals regarding macro policy shifts. But only part of those signals were aired at Jackson Hole.

We depart from the usual format (Chart of the Week, Quote of the Week, Top Three Reads) to show how a chart-based and data-rich approach to analyzing monetary policy can yield material informational advantages for human strategists who read in addition to the quants that use the data to deliver signals.

This week, we deliver Three Charts to show that the real conversation among leading central banks is more about GDP Growth and Reserve Currency dynamics than it is about inflation. As usual, hyperlinks to source documents are included so you can verify the analysis.

macroVS Episode 26 -- Reserve Currency Policy Pressures, measured