ACTV - May 2024 FOMC
2024-05-08 08:40:00 ET
Summary
- This past week saw the release of a raft of important economic data which, in combination with the FOMC’s decision, have important implications for the path of interest rates through 2024.
- In the middle of the data releases, the FOMC met on Tuesday and Wednesday and decided to hold the target funds rate range constant and also to slow the rate that it would let maturing Treasuries and agency securities run off.
- On Wednesday, in the middle of the FOMC’s two-day meeting, the JOLTS data for March were released, showing job openings relatively unchanged at 8.1 million, a very high level.
By Robert Eisenbeis, Ph.D.
This past week saw the release of a raft of important economic data which, in combination with the FOMC's decision, have important implications for the path of interest rates through 2024. At the beginning of the week, we got the advance estimate of real GDP growth for Q1 2024, which came in at 1.6%, down about half from the 3.4% growth experienced in Q4 2023, suggesting an abrupt slowdown in the economy. Then, on Wednesday, in the middle of the FOMC's two-day meeting, the JOLTS (Job Openings and labor Turnover Summary) data for March were released, showing job openings relatively unchanged at 8.1 million, a very high level, indicating a strong labor market in the middle of what appears to be an economic slowdown. That inference of an economic slowdown was further supported by the BLS jobs data, which showed that job creation in April slowed to 175,000, down from 315,000 in March and 236,000 in February, and the unemployment rate held constant at 3.9%. The numbers for the week led the NY Fed to drop its Q2 GDP forecast from 2.74% to 2.23%. This forecast is still greater than the 1.8% widely thought to be potential for the economy....
May 2024 FOMC