The members of the FOMC voted on Wednesday, May 3 announced it would raise rates by +25 bp, as most on the Street predicted. The vote was unanimous. In its previous rate hike on March 22, the Fed wrote that “the committee anticipates that some additional policy forming may be appropriate.” This time, that phrase was modified–removing the words, “the …
What Does The Fed’s November Hike Mean For Markets?
in Fed Watch, Market Intelligence“As investors, we also always have to be aware of our innate and very human tendency to be fighting the last war. We forget that Mr. Market is an ingenious sadist, and that he delights in torturing us in different ways.” – Barton Biggs The Federal Reserve held their highly anticipated November FOMC meeting on Wednesday. As expected, the world’s …
What Does September’s Rate Hike and Dot Plot Mean For Markets?
in Fed WatchThe FOMC met yesterday to announce their latest rate hike. As the market for Fed Funds Futures implied leading up to the meeting, the committee decided on a 75-bps hike. We wanted to provide a special update on where things stand with the Fed and markets after their third-to-last meeting of 2022. The next rate decision will be on November …
Special Edition: Everything You Need to Know About Jackson Hole
in Fed WatchThe Jackson Hole Symposium has become one of the pre-eminent events for central bankers, policymakers, and economists. The Federal Reserve Bank of Kansas City hosts the event every year. Each year has a different theme. This year’s theme was “Reassessing Constraints on the Economy and Policy. The agenda for the event can be found here. The event was first held …
Fed Minutes: Despite Encouraging July CPI, Inflation Remains Far Too High
in Fed WatchIt’s not time for a victory lap just yet, even after markets have rallied substantially since their June lows, and an encouraging July CPI print pushed them higher. This week, the Fed released the minutes from its most recent policy meeting in late July. Fed officials, according to the minutes, think inflation remains too high, and are committed to raising …
CPI and PPI Come in Below Expectations, Potentially Giving FOMC Some Breathing Room
in Fed WatchThere was finally some relief after a steady stream of hot inflation data. After 10 months of upside surprises, CPI finally came in lighter than expectations on Wednesday. Core CPI was slightly down and essentially flat, Food was slightly up, and Energy had the biggest drop and made the downside surprise possible. The 8.5% headline number is still more than …
Jobs surprise: U.S. economy added 528,000 jobs in July; CPI print coming next week
in Fed WatchWhat recession? The good news: A much stronger than expected reading on July employment came in hot. The U.S. economy added 528,000 jobs in July, the Labor Department reported, far exceeding the 258,000 consensus estimate. The unemployment rate ticked down to 3.5% from 3.6%, while average hourly earnings climbed 15 cents, or 0.5%, to $32.27. This unemployment rate marks the lowest …
Fed Raises by 75-bps But Signals More Normal Hikes Possible, PCE Comes in Hot
in Fed WatchThe Fed’s July meeting was on Wednesday and, as expected, the FOMC raised rates by 75 bps to a range of 2.25%-2.5%. This was the second consecutive jumbo rate hike. The two back-to-back hikes of 75 bps were actually the most stringent consecutive action since the beginning of the 1990s when the Fed began using the rate as its primary …
All Eyes on FOMC Meeting Next Week Amid Hot Inflation
in Fed WatchFederal Reserve officials have indicated they are gravitating toward another 0.75-percentage-point rate rise at their July 26-27 Federal Open Market Committee meeting, even as they have faced questions about their willingness to do more than that to bring down high inflation. Central bankers have signaled they will do whatever it takes to lower inflation that is now running above 9%. …
June CPI Report Comes In Hot, Fed Fund Futures Retreat After Initial Shock
in Fed WatchThe June CPI print came in at 9.1% on Wednesday on expectations of 8.8%. This was higher than expectations and the report did not give Fed officials any reprieve from persistently high price pressures. Shelter was problematic and so was gasoline. Hotels benefitting from revenge spending contributed as well. The initial market reaction was likely somewhat extreme in Fed Funds …