Fed Talk

Does the Fed make mistakes... or is everything orchestrated? :scratchchin:


Jobs report stokes fears Fed may have waited too long

The report is "definitely going to raise concerns now that the Fed is behind the 8-ball," Marc Pinto, Janus Henderson Investors head of Americas equities, told Yahoo Finance.

Fed chair Jerome Powell said Wednesday that a cut in September was “on the table” as long as the data supported it while acknowledging that there was a discussion at this week’s meeting about whether to move in July.
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Jobs report stokes fears Fed may have waited too long
 

Recent inflation data suggests a "disinflationary trend" and has fueled expectations of rate cuts in September.

The market is so certain of a rate cut coming in September that the current probability is 98.1%. Meanwhile, it's 4.7% for July 31.

While Fed members are speaking openly about a possible September rate cut, they are still watching the data. If data is not favorable to a September rate cut it could shake this market's certainty and induce a correction in its value.

Maybe that was a trigger for selling today when today Fed official John Williams told us a September rate cut is more likely than a July rate cut. That is true, but is that him saying a rate cut is coming in September? Even if it is, no single Fed Member would know that for certain, they are a voting party and can be swayed by incoming data.

More Fed members will talk publicly over the next two days alongside some jobs data, another concern for the Fed and the market. Will they keep this market narrative going?


Top Officials Suggest Fed Is Closer—But Not Yet Ready—to Cut






 
Fed Governor Waller sees central bank ‘getting closer’ to an interest rate cut

Keeping with statements from other policymakers, Waller’s sentiments point to an unlikelihood of a rate cut when the Federal Open Market Committee meets later this month, but a stronger likelihood of a move in September.

Central bankers have become more optimistic by data in recent months that has shown inflation easing after a surprisingly higher move for the first three months in 2024.
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Fed Governor Waller sees central bank '''getting closer''' to an interest rate cut
 
Powell indicates Fed won’t wait until inflation is down to 2% before cutting rates

Powell referenced the idea that central bank policy works with “long and variable lags” to explain why the Fed wouldn’t wait for its target to be hit.

The central bank is looking for “greater confidence” that inflation will return to the 2% level, Powell said.

The Fed’s next policy meeting is at the end of July.
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Powell indicates Fed won'''t wait until inflation is down to 2% before cutting rates
 
Renewed Hope on Inflation but More Confidence Needed

By Raphael Bostic - President and Chief Executive OfficerBy Raphael Bostic, President and Chief Executive Officer

Despite those hopeful recent glimmers, the stubbornness of inflation early this year indicates that progress toward the FOMC's 2 percent objective will likely come more slowly than I and others had previously hoped. That said, I have long maintained that the path to 2 percent would take considerable time; it just might take a little longer than one might have expected given how fast inflation was falling as we exited 2023.

If conditions unfold as I expect—orderly slowing in the labor market and in economic activity—then inflation should fall all the way to 2 percent in 2025 or perhaps a bit later.
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Message from the President: Renewed Hope on Inflation but More Confidence Needed - June 27, 2024 - Federal Reserve Bank of Atlanta
 
Fed’s Kashkari says it’s ‘reasonable’ to predict a December rate cut

“We’re in a very good position right now to take our time, get more inflation data, get more data on the economy, on the labor market, before we have to make any decisions,” Kashkari said. “We’re in a strong position, but if you just said there’s going to be one cut, which is what the median indicated, that would likely be toward the end of the year.”
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Fed'''s Kashkari says it'''s '''reasonable''' to predict a December rate cut
 
Funny how market rallies on rate cut hopes, but if the market is going up, the fed has no reason to cut rates.
 
Jerome Powell: "Inflation is still too high. Further progress in bringing it down is not assured and the path forward is uncertain."

Stocks soaring on the news. :laugh:
 
Here’s everything to expect from the Federal Reserve’s policy meeting Wednesday

The Fed has a lot to do at its meeting this week, but ultimately may not end up doing a whole lot in terms of changing the outlook for monetary policy.

This meeting likely will be all about the Federal Open Market Committee’s “dot plot” of individual member’s interest rate expectations.

Officials also will release their quarterly update on the economy, specifically for gross domestic product, inflation and the unemployment rate.
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Here'''s everything to expect from the Federal Reserve'''s policy meeting Wednesday
 
Powell insists the Fed will move carefully on rate cuts, with probably fewer than the market expects

Federal Reserve Chair Jerome Powell vowed in a “60 Minutes” interview aired Sunday that the central bank will proceed carefully with interest rate cuts this year.

“We just want some more confidence before we take that very important step of beginning to cut interest rates,” he said.

Powell warned that the monetary policy tightening would cause “some pain.” However, “it really hasn’t happened,” he added.
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Powell insists the Fed will move carefully on rate cuts, with probably fewer than the market expects
 
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