Investors fretting over the timing of the next hike in United States interest rates are not much the wiser after Federal Reserve chairman Janet Yellen's speech last Friday.
Yes, Dr Yellen tabled a stronger case for the Fed to normalise US rates from their historic lows but jittery markets are still left wondering just when rates will head north.
In her speech, Dr Yellen said recent improvements in the US labour market and a wider economy have made a hike more likely.
But she stopped short of giving an indication of timing, only describing the path of rises as gradual.
Market estimates place the next hike closer to the year-end or even early next year.
Bank of Singapore chief economist Richard Jerram expects one hike in December, then two to three more next year.
"The Fed has a problem with its communications policy and the market impact will be limited as a result. My sense is that the Fed is like the boy that cried wolf," he said.
"So many times over the past year they have suggested that a rate hike is imminent and then backed away for one reason or another. I doubt the hike will happen in September," Mr Jerram told The Straits Times.
But this also means an unexpected hike could spell trouble.
"The market is not fully prepared for a September rate hike and thus any hawkish surprise could dampen fragile sentiment, potentially leading to panic selling," said CMC Markets analyst Margaret Yang.
The initial market reactions were measured. After Dr Yellen's speech, the US dollar rose 1.3 per cent against the Japanese yen and 0.42 per cent to the Singdollar, while gold pared 0.06 per cent against the greenback.
The Dow Jones Industrial Average fell 0.29 per cent.
In Singapore, risk appetite has been low with the benchmark Straits Times Index dropping 0.67 per cent on Friday. For the week, it added 0.48 per cent but the five-day volume slowed to a trickle, with only 606.8 million blue-chip shares traded.
Investors will now wait for the US August job data out this Friday, which is expected to come off from July's surprisingly strong number.
In any case, Asian markets are in no shape to take any unpleasant surprise, Ms Yang cautioned.
She noted: "A dramatic increase in the likelihood of a rate hike will push the (US) dollar index higher, expounding the weakness in commodities…
"On the backdrop of slumping commodities, weak demand and overcapacity in emerging economies, sentiment has become more fragile and susceptible to any form of shocks. These shocks include the likes of the Fed-rate normalisation path, the US election and rising political and financial risks in overseas markets."
The mixed outlook for oil prices will add to market uncertainty, especially after a recent statement by Saudi Arabia playing down the possibility of an organised output freeze by major producers.
More clarity on this front will emerge from the informal meeting of the Organisation of Petroleum Exporting Countries (Opec) next month, but OCBC analyst Barnabas Gan is not overly optimistic.
"The truth is, the global oil environment is still in oversupply territories. Empirically, Opec oil supply in July has touched historical highs… led by higher production in Iran and Saudi Arabia in the first six months of 2016," he said in a note last week.
Against this backdrop, a price correction may be at hand for international crude oil benchmark Brent futures, after gaining close to 15 per cent over the past month to as high as US$50.8 a barrel.
