Janet Yellen's comments won't be market-moving: UBS' Hartmut

Federal Reserve chairman Janet Yellen's speech today won't be market moving, says Hartmut Issel, Head Equity & Credit for Asia Pacific and Chief Investment Officer for Weal, UBS. Her comments are likely to increase expectations of a December rate hike, he said.Her speech will bring to light her long-term plans. Rates may rise in the short-term, he says, but Yellen is dovish in the long-term.

India is likely to see healthy earnings growth. But he says that he wouldn’t be surprised if Indian markets take a breather for a while.Below is the verbatim transcript of Hartmut Issel's interview to Prashant Nair and Ekta Batra on CNBC-TV18. Ekta: Your first thoughts, do you expect some market moving statements coming in from Janet Yellen this evening? A: I think we will get a little bit more of direction, but whether that is going to be a big market moving event, I am a bit doubtful. Here are my thoughts, you already had basically her number 2 and number 3 coming out and announcing a leaning towards doing something this year even though I think September is unlikely, but more likely in December. She I think will take it in notch up also a bit less dovish, but then again I don’t think she will definitely conditioned the markets that the price in the likelihood a lot higher, close to 100 percent for a hike because she then will be in a very comfortable situation. If she just notches the expectation for December a little bit maybe to 60 percent, 65 percent thereabout, that still leaves a lot of flexibility to change course if she thinks she have to. Prashant: Can she say anything which sparks a rally even from here. I mean if they say if you got a approval ratings of 95 percent is more likely that your approval ratings go down, they don’t go higher. With the S&P and global markets at level where we are and the expectation being overwhelmingly one of dovishness, can she express anymore dovishness than they already is about rate increases, which sparks the rally from here or you think irrespective of whatever she says maybe we get a bit of drawdown next week? A: I see one angle, I would be surprised if she detracts from the announcement that we already had from her arguably most important fellow member of the Fed. We shouldn’t expect that she sort of tries to pull the expectation down in the short term, so I think the angle possibly could be seen as dovish is the more long term aspect, because we shouldn’t forget the reason why she injects no is not to talk about short term Fed policy primarily she is there to talk about the framework for longer term, for the future basically. There what I could imagine is that she brings the longer term expectation of sort of equilibrium rate a bit down or notches them down and that could mean to market okay rates maybe rising, but generally speaking longer term lower for longer perhaps and that could be a dovish market conducive signal, so I would also watch for the longer term outlook that she will give, which is her main mandate there anyway.