Ben Bernanke did not prescribe a new dose of medicine for the ailing U.S. economy at this year's central bank confab amid Wyoming's Teton mountains, but he didn't give it a clean bill of health, either.
That should be a reminder for investors -- if any needed one -- that the U.S. economy remains fragile and will likely rivet attention on economic data due in the coming week, topped by the monthly jobs report.
Such worries may add up to more volatility for the stock market, particularly if the week ends with data showing the pace of U.S. hiring slowed and the jobless rate, which exceeds 9 percent, increased.
Benchmark 10-year Treasury yields backed up a bit last week but remain near multi-decade lows at 2.19 percent.
But if the reaction in markets is any indication -- stocks rallied and high-yield, growth-sensitive currencies rose -- investors may be starting to entertain the notion that the economy may yet avoid slipping back into recession.
While data showed growth slowed to a 1 percent annual rate in the second quarter after nearly flat-lining in the first, investors took some comfort from Bernanke's assertion that the Fed expects "a moderate recovery to continue and indeed strengthen over time."
"For all the focus on QE issues, we should not lose sight of [Bernanke's] most important message that the Fed does not foresee the economy heading into renewed recession, even if there is plenty of fragility." said Alan Ruskin, head of G10 currency strategy at Deutsche Bank.
Regardless of any impact from Hurricane Irene, history does not bode well for this time of year. Although September marks the return from vacation for many investors, it is the cruelest month for stock markets.
Since 1971, MSCI's index of developed stock markets has fallen an average of 0.7 percent in September -- the worst reading for any month of the year.
That's not particularly good news for investors, given that the index has given up roughly 10 percent this year.
Add to that the possibility that the euro-zone debt crisis may come back into focus. It was showing signs of doing so heading into the weekend as the cost of insuring Greek debt against default neared record highs.
Markets fear German Chancellor Angela Merkel has been giving mixed messages, pledging to do what it takes to bolster the euro zone but keeping an eye on domestic opposition to Germany spending too much on bailouts.
This will be tested at the end of the coming week by a state election in Germany.
There are also a series of important debt auctions in Italy, Spain and France to test investor appetite.
Any signs of stress could hurt the euro, which gained on the dollar last week but has had a tough time pushing through the top of a broad $1.40-$1.45 range that has persisted since mid-July.
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