The Fed Has Some Explaining to Do

Markets no longer have a framework for understanding what the U.S. Federal Reserve plans to do with interest rates -- and a policy-making meeting this week isn't likely to shed much light. That's a gap that Fed Chair Janet Yellen, when she next speaks to the public in late August, will have to fill.

It's pretty much a given that when the policy-making Federal Open Market Committee meets on Tuesday and Wednesday, it will decide to leave its short-term interest-rate target unchanged -- and the accompanying formulaic statement won’t do much to dispel growing uncertainty about how the central bank’s next steps. So the next opportunity to provide clarity will come on August 26, when Yellen is scheduled to speak at the Kansas City Fed's economic conference in Jackson Hole, Wyoming -- a venue that her predecessor used to set out the central bank's plans for the ensuing three to six months.