by Calculated Risk on 8/25/2014 09:22:00 PM

From Gavyn Davies at the Financial Times: Draghi steals the show at Jackson Hole

The markets may read this as an empty threat, but they should note the importance of what [ECB President Mario Draghi] said about inflation expectations, which was added to the written text by the President himself on the day of the speech:

"Over the month of August, financial markets have indicated that inflation expectations exhibited significant declines at all horizons. The 5 year/5 year swap rate declined by 15 basis points to just below 2% … But if we go to shorter and medium-term horizons the revisions have been even more significant. The real [interest] rates on the short and medium term have gone up … The Governing Council will acknowledge these developments and within its mandate will use all the available instruments needed to ensure price stability over the medium term."

This is much more explicit language about declining inflation expectations than anything the ECB has used in the past.

Tuesday:
• At 8:30 AM ET, Durable Goods Orders for July from the Census Bureau. The consensus is for a 5.1% increase in durable goods orders. NOTE: The headline number could be huge because of a large number of aircraft orders in July.

• At 9:00 AM, S&P/Case-Shiller House Price Index for June. Although this is the June report, it is really a 3 month average of April, May and June. The consensus is for a 8.4% year-over-year increase in the Composite 20 index (NSA) for June. The Zillow forecast is for the Composite 20 to increase 8.1% year-over-year, and for prices to be unchanged month-to-month seasonally adjusted.

• Also at 9:00 AM, the FHFA House Price Index for June. This was original a GSE only repeat sales, however there is also an expanded index. The consensus is for a 0.3% increase.

• At 10:00 AM, the Conference Board's consumer confidence index for August. The consensus is for the index to decrease to 89.7 from 90.9.

• At 10:00 AM, the Richmond Fed Survey of Manufacturing Activity for August.