As Central Bankers Meet, Economic Uncertainties Weigh on Sunny Outlook

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The Wall Street Journal  | Thu, Aug 23, 2018

by Nick Timiraos

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Tariffs, emerging markets and U.S. discord are likely to be the focus of side conversations at the Fed’s annual mountain retreat

JACKSON HOLE, Wyo.—Global central bankers are navigating a new set of threats as they decide how aggressively to act in closing out an era of exceptionally easy money.

Uncertainties include the prospect of disruptions to economic activity from tariffs imposed by the U.S. on China, Europe, Canada and others, and counter-tariffs imposed by those nations on the U.S. Emerging markets also look vulnerable if capital flight spreads beyond a handful of countries grappling with currency crises. Then there is the potential for discord between the Federal Reserve and President Trump, who has criticized the U.S. central bank in recent weeks for raising interest rates.

Fed Chairman Jerome Powell headlines a long list of central bankers gathering in the Grand Tetons this week for the Fed’s annual mountain retreat. The formal discussion will be about the impact of monopolies on economic activity, but these other issues are sure to dominate sideline talk over cocktails and mountain hiking.

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