Fluellen-Hoover Multifamily Group的动态

The Fed should consider front-loading rate cuts with a 50bp reduction next week, followed by a total of 150bp cuts this year.?This strategy goes beyond just preventing a recession; it aims to ensure a strong labor market, consistent with Powell's commitment to doing "everything we can to support a strong labor market." By normalizing policy rates sooner rather than later, the Fed would also gain greater flexibility to adjust rates—either upward or downward—if needed in the future. For further analysis, see https://lnkd.in/dFQnMrXD

The Fed. Oh yeah, they have a meeting and a potential rate cut this week. There was that other thing last night that had me distracted. A few thoughts from Nick Timiraos on what to watch for out of Powell. "The Federal Reserve is widely expected to cut interest rates by a quarter-percentage point at its meeting that ends Thursday. The bigger question is how many more cuts officials expect will be warranted to preserve a solid job market without reversing?recent declines in inflation." "First, does the?election result?lead to meaningful changes for economic demand or inflation that warrant a different policy path?" "Second, have jitters about job-market deterioration been overstated? When the Fed cut rates in September, the unemployment rate had ticked up to 4.3% in July from 3.7% at the beginning of the year." "Third, where is inflation headed? Inflation based on the Fed’s preferred index has been slowing. The index rose 2.1% in September from a year earlier. A separate measure of so-called core inflation that strips out volatile food and energy prices was 2.7%." "Fourth, what is the right level for rates, anyway? Officials are trying to bring rates back to a more “normal” setting after two years of rapidly increasing borrowing costs to fight inflation. But they don’t know what constitutes a normal rate." #economy #markets #fed #rates https://lnkd.in/gi7Jc_rJ

Fed Watch: Business as usual The Fed cut interest rates by 25bp, as expected. Also as expected Fed Chair Powell refrained from commenting on the election. The only message was that he will stay FOMC Chair until his term ends in May 2026. The election, thus, has no short-term impact on monetary policy or the Fed's independence. The Fed seems to be pleased by how the labour market and inflation are developing. Cuts by 25bp seem to be the Fed's base case in walking the middle path of guiding inflation towards 2% and preventing the labour market from cooling further from its current non-inflationary state. ?? Read more in today's report by Franz Xaver Zobl: https://lnkd.in/eAd5b9as #Raiffeisenresearch

The WSJ is highlighting the challenge by the Fed to stick the landing. The move in the long end from the start of the easing process is something depositories must consider. Further, Scenario 2 below also demands attention on protecting earnings if the Fed has to get more aggressive with cuts. “In one scenario, stronger consumer spending will continue to help stabilize the labor market because it will maintain solid demand for workers. In that more optimistic circumstance, the recent cooling in the labor market would reflect a postpandemic normalization and the Fed would be able to make fewer rate cuts.” “More ominously, further weakness in income growth could weigh on consumer spending in the months to come, making the economy more vulnerable to a slowdown and potentially calling for more cuts.”

I'll make my call - no Fed cuts in 2024. The CPI report wasn't a disaster like the market's reaction would spell, but it's a timing issue. The Fed's REAL first mission isn't full employment, or low inflation... it's to maintain its credibility, and to do so it must be seen as non-partisan. We're already halfway to the July meeting with all monthly readings saying, "current elevated monetary policy is not restricting growth". That takes a July cut off the table. The later meetings are too close to the election window for any action other than staying the course. If the Fed were to raise, cut, anything other than stay the same after July until 2025, it would be seen (regardless of motive) as political manipulation by half of America.

So the Fed has gone with a 50bps rate cut as part of "recalibration" rather than a crisis driven cut. This reflects the Fed's shifting focus on employment over inflation, with the later moving towards the Fed's inflation target. Market reaction so far has been mixed. This will no doubt provide some support to risk assets, but could a cut of this magnitude potentially signal that the Fed is behind the curve? With the first cut in motion, attention now shifts to pace of the cuts. And there seems to be divergence of the Fed's cautious approach vs market expectations. All eyes now on upcoming economic data for guidance, like how cards unfold in a game of poker. #invest #economy #marketTrends

SUMMARY OF FED CHAIR POWELL TESTIMONY (3/6/24): 1. Do not expect rate cuts until "more confidence inflation is moving sustainably to 2%" 2. Inflation has improved but still above 2% long term target 3. There are risks to cutting interest rates too early and too late 4. Labor market demand still exceeds supply 5. "Likely appropriate" to cut rates sometime in 2024 6. The Fed "will carefully assess incoming data" Is higher for longer back?

*SUMMARY OF FED CHAIR POWELL TESTIMONY: 1. Do not expect rate cuts until "more confidence inflation is moving sustainably to 2%" 2. Inflation has improved but still above 2% long term target 3. There are risks to cutting interest rates too early and too late 4. Labor market demand still exceeds supply 5. "Likely appropriate" to cut rates sometime in 2024 6. The Fed "will carefully assess incoming data" For information only*

SUMMARY OF FED CHAIR POWELL TESTIMONY (3/6/24): 1. Do not expect rate cuts until "more confidence inflation is moving sustainably to 2%" 2. Inflation has improved but still above 2% long term target 3. There are risks to cutting interest rates too early and too late 4. Labor market demand still exceeds supply 5. "Likely appropriate" to cut rates sometime in 2024 6. The Fed "will carefully assess incoming data" @thekobeissiletter.com

??Monday Rate Update: Higher than last week. The Fed’s focus is shifting toward labor data rather than inflation alone, meaning the upcoming employment reports will be key to understanding whether further rate cuts are likely. While the Fed is unlikely to reduce the Fed Funds rate immediately, we’ll have clearer signals on future rate trends within the next two weeks.