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The Fed’s mandate is for stable prices and maximum employment. By understanding the trends within the labour market, we can gain valuable insight into the likely monetary policy actions of the Fed. With an undersupply of workers and cycle low in unemployment, the labour market ...
The Consumer Confidence Index from The Conference Board fell again in July, third drop in a row and eighth in the last 13 months. Within the expectations index, just one of the three components fell versus June. The outlook for the jobs market improved marginally in July as the ex...
In all fairness to the Atlanta Fed, some of last week’s statistical releases indicate an economic slowdown, but at a very slow pace, nothing like the rapid contraction that accompanied serious contractions in 2008-9 or 2020. Russia’s Gazprom last week notified major cust...
As inflation raged, central banks accelerated the pace of monetary policy tightening, aiming to slow the growth of aggregate demand and calm price pressures. In response to persistently high inflation and an upward drift in long-run inflation expectations, central banks are accelerati...
On the heels of a surprise 50-basis-point increase in the ECB’s target rate the FOMC will likely make good on another 75-basis-point increase in its target federal funds range. Governor Waller stated that he favored another 75-basis-point increase, as has St Louis Fed President...
This coming week, we will get the Fed’s view of the appropriate level of interest rates. Much of the focus will be on the interest rate number. Far less attention paid to the cause of the action. Without understanding the causes, it is difficult to comprehend whether the result...
Market views of Fed rate hikes have swung sharply. We see more volatility ahead as long as central banks think they can curb inflation without crushing growth. Yields spiked before easing after the ECB raised rates by 0.5% last week. We expect it to pause hikes before the Fed as the e...
The Fed's decision is imminent this Wednesday. While the market is pricing in a 75 basis point rate increase, it may get shocked if the Fed raises by a whole 1%. The S&P 500 is around a critical technical level, and the current rally will probably get cut short if the Fed rais...
The S&P 500 Index closed out the week ending July 22 with a gain of 2.57%. The index is also now trading above its 50-day moving average. Many other indexes are showing technical improvement as well and are trading above their 50-day moving averages. This is certainly a positive t...
The services side of the economy is considerably larger than the goods side and if it really is contracting at that rate, a recession is probably coming fairly soon. Investing is often a counterintuitive exercise and it is most counterintuitive – and hardest – at turning...