Joshua Mahony, market analyst at IG, adds his voice to those expecting a US rate rise in December:

Esther George of the Kansas Fed gave markets something to chew over, with yet another hawkish comment coming in a long line of Fed members keen to talk about higher rates. After appearances from Dudley and Fischer last week, today’s input from voting member George adds yet another voice to the increasingly deafening push for a rate hike in the coming months. With the election looking unpredictable, the likeliness is that members will see December as the month to press the button once more, one year on from the contentious 2015 rise. It is hard to see Janet Yellen delivering anything other than a relatively hawkish outlook tomorrow [at Jackson Hole] and with the dollar having suffered heavily in recent weeks, tomorrow could be a turning point for foreign exchange markets.

Another comment suggesting that the Jackson Hole gathering of central bankers in the US could be a damp squib, despite expectations that Fed chair Janet Yellen could hint at future rate rises. David Morrison, senior market strategist at Spreadco, said:

Investors continue to hold back from taking on additional market exposure ahead of tomorrow’s speech from Janet Yellen at the Jackson Hole Economic Symposium. Few expect the Fed Chairman to say anything explicit about the likelihood or timing of what would be the US central bank’s first rate hike since December last year. Nevertheless, there are hopes that she may give some clues as to the Fed’s thinking over the state of the US economy, and indeed any risks facing the global economy as well.

Last week we heard hawkish rhetoric from three Fed members. Then on Sunday Fed Vice Chairman Stanley Fischer provided an upbeat outlook for the US economy saying that he expected growth to pick up following a particularly weak second quarter. Not only that, but he said that the Fed’s targets for inflation and unemployment (the dual mandate) were close to being hit. If Yellen is similarly upbeat in her speech tomorrow, then investors will price in an increased possibility of a September hike.

But despite all this chatter and speculation, it seems unlikely that Yellen will want to paint herself into a corner over the future direction of US monetary policy.

Consequently, it could be that there’s little of substance in the speech. While we’ve had a clutch of Fed-heads out there trying to persuade investors that September is still “live” when it comes to a rate hike, the minutes from the last meeting in July showed that only one out of ten FOMC-voting members was in favour of tightening monetary policy. In addition, we’ll get a stack of fresh economic data ahead of the Fed’s next meeting, including Non-Farm Payrolls, Manufacturing and Non-Manufacturing PMIs and inflation numbers. There’s really no point in committing to any course of action until the Fed sees these reports.

Finally, I don’t believe that the FOMC has the faintest idea what they should do at the next meeting. And unfortunately we now have a central bank which pays too much attention to stock market movements and appears to relish its ability to influence short-term investor behaviour.

Overall, I think there’s just too much importance being attached to this speech. Jackson Hole was a fairly obscure event in years gone by. It only attained its current significance when Ben Bernanke used it as a forum for market manipulation in the wake of the 2008/9 financial crisis. It would be better for all if it went back to being a boring conference for boring people.

Back with the UK, and the strong retail sales figures from the CBI back up the idea that any negative effects of Brexit on the economy will only appear slowly, writes economic editor Larry Elliott:

The latest PMI data means a US rate rise in September is unlikely but could signal a move in December, said Chris Williamson, chief business economist at Markit:

The ongoing lacklustre economic growth signalled by the flash PMI suggests GDP growth is failing to accelerate in the third quarter from the weak 1.2% pace seen in the second quarter.

Historical comparisons indicate that the PMI is signalling an annualised GDP growth rate of just under 1% in the third quarter, based on the data for July and August.

With job creation also waning alongside subdued price pressures (the August PMI is consistent with non-farm payrolls rising by just under 130,000), the survey data will fuel expectations that the Fed will be in no rush to tighten policy again.

However, as anecdotal evidence from the survey suggests that business activity is being dampened by uncertainty due to the upcoming presidential election, there’s a good chance that the economy will pick up speed again after the vote, leaving a December rate hike on the table.

After the better than expected US durable goods and jobless claims figures, a service sector survey for August has missed forecasts.

The IHS Markit service sector initial PMI came in at 50.9, down from 51.4 in July and below forecasts of 52. This was the weakest rise in services activity since February. Markit said:

U.S. service providers indicated another month of lacklustre growth in August, with business activity, new orders and employment all rising at a slower pace than in July. Survey respondents generally cited subdued underlying demand conditions and uncertainty ahead of the presidential election as factors that had dampened growth in August. Nonetheless, the balance of service sector firms expecting a rise in business activity over the year ahead remained well above the survey-record low seen in June.

The composite PMI slipped from 51.8 in July to 51.5.

Neil Wilson, market analyst at ETX Capital is decidedly underwhelmed at the prospect of Jackson Hole:

Don’t expect much from Jackson Hole.

The Federal Reserve Bank of Kansas City’s annual economic policy symposium is a serious, sombre affair. It is not a policy meeting, nor is it meant to drive expectations for future policy decisions. It’s a talking shop and we should take the goods on offer with a healthy dose of salt.

Markets are incredibly quiet this August (in sharp contrast to last year) so investors are latching on to anything they can, which gives this meeting a lot more attention than it probably deserves. Investors will hang on every word uttered by Janet Yellen, the Federal Reserve chair.

...But Yellen’s habit of keeping markets guessing with alternately hawkish and dovish remarks should be kept in mind. Indeed what the meeting will highlight is just how hard it is for central banks to normalise policy after years of accommodation.

Economists taking part in a Reuters poll believe the Brexit vote will weigh on UK house prices over the next couple of years.

Average UK house prices are expected to rise by 2.8% in 2016, 1.3% in 2017, and 2.4% in 2018.

London property prices are forecast to increase by 2% in 2016, by zero in 2017, and by 2% in 2018.

Sports Direct is back in the headlines after a major investor group spoke out about the retailer’s corporate governance failings.

The Investor Forum has 40 members and represents 27% of Sports Direct’s independent shareholders, including Legal & General, Aviva, Standard Life and Fidelity. It was set up two years ago and this is apparently the first time it has made public concerns about a company.

Governance failings are clearly resulting in declines in operating performance and long term shareholder value and, given the lack of progress and the broader impact on all stakeholders, the Forum now considers it important to make public its recommendations to the Sports Direct International board.

The Investor Forum calls on the board and its founder Mike Ashley to launch an independent review of the company’s “entire corporate governance framework” at the annual meeting on 7 September. They must commit to implementing the recommendations of that review, it adds.

Andy Griffiths, executive director of the Forum:

It is highly unusual for the Investor Forum to consider it necessary to make public their concerns and recommendations in this way. In prior situations we have always managed to work privately with companies to create effective long term solutions.

We do not take this step lightly and whilst we welcome SDI’s move to hold an open day, we still have not received an appropriate level of commitment to respond to investor concerns and, as a result, the usual options have been exhausted.

Phillip Inman, the Guardian’s economics correspondent, has written a handy list of five problems facing central bankers as they head to Jackson Hole for the annual symposium.

Here they are in short:

• Markets are addicted to low rates

• Negative interest rates

• A stagnant eurozone

• Fragile emerging markets

• Currency wars

Read the piece in full here:

Ruth Gregory at Capital Economics says the strong UK retail sales reported by the CBI won’t last as the impact of the Brexit vote starts to creep into the data:

With labour market conditions likely to deteriorate and rising inflation set to undermine real wage growth, it would be fairly surprising if retail sales growth didn’t slow at all in the aftermath of the leave vote.

It shouldn’t be too dire for retail sales though, she adds:

We think that other supportive factors – including low interest rates – should prevent household purchases from slowing too sharply. What’s more, the upbeat tone of the forward-looking indicators provide us with some reassurance that we’re not likely to see a marked collapse in consumer spending ahead.

And we’re back...

Guardian Towers is being evacuated following a fire alarm... we’ll be back as soon as possible

Jasper Lawler, analyst at CMC markets, has this take on Thursday’s share price falls across Europe:

European healthcare stocks have been caught in the storm of another attack on price gauging in the industry from presidential hopeful Hillary Clinton.

Shire and Hikma Pharmaceuticals are amongst the top fallers on the FTSE 100 whilst Qiagen in Germany was a top faller in the Stoxx 600 Healthcare euro price index.

The FTSE 350 Mining Index is off by over 2% from the open. Poorly-received earnings from Glencore on Wednesday and lower oil prices continue to weigh on commodity-sensitive shares.

Carsten Brzeski, ING chief economist for Germany and Austria, says the weak August Ifo survey suggests German business confidence has been struck down by the Brexit vote.

Oops. It seems that German businesses always take a bit longer to digest the news but today’s Ifo suggests that German businesses have suddenly woken up to Brexit reality.

Germany’s most prominent indicator, the Ifo index, decreased sharply in August to 106.2, from 108.3 in July; the strongest monthly drop since May 2012. The drop was equally driven by decreases of both the current assessment and the expectations component. The expectations component is now at its lowest level since October 2014.

What we had feared could happen did unfortunately happen: German businesses continued a longer tradition of delayed reactions to single and unexpected events. It is not the first time that the Ifo reacts with a delay of one or two months to global events.

Today’s Ifo reading is a good reminder that the relative benign reaction of Eurozone data to the Brexit vote should not be taken as given. The negative confidence impact is for real.

European markets are expected to open lower: