ACTV - Food For Thought: The Fed - We'll Get There When We Get There
2024-02-04 02:12:00 ET
Summary
- Instead of pivoting directly toward an easing bias, the Federal Open Market Committee opted for a wait-and-watch approach in January.
- Zillow’s observed rents are up 27% since January 2021, while PCE tenant and owner-occupied rent levels are up 19%.
- On balance, given an economy that continues to grow well above potential, a still-healthy labor market, and the possibility of inflation (and wage inflation) surprises going forward, the Fed’s data-dependent approach makes sense.
By Nikhil Mohan, Economist, Franklin Fixed Income
For months, we’ve pushed back against the idea that the Federal Reserve (Fed) will begin its easing cycle as early as March. Indeed, that is precisely what Fed Chair Jerome Powell confirmed at the January Federal Open Market Committee ((FOMC)) meeting. Unsurprisingly, gone was any language that referenced “any additional tightening,” thus further cementing the December pivot....
Food For Thought: The Fed - We'll Get There When We Get There