Posts Tagged ‘Fed’

The Fed is likely to wait until September before hiking rates

Read full report here In Friday’s report on income and consumption, data were also published on the PCE deflator, the price measure targeted by the Fed in gauging inflation. The core PCE price index (excluding food and energy) increased by 0.1% month-on-month (m-o-m) in March, in line with consensus expectations. On a year-on-year (y-o-y) basis, core […]

US monetary policy: a second rate hike in June remains the most likely scenario

As widely expected, at yesterday’s FOMC meeting, the Fed chose to ‘stand pat’. Although yesterday’s FOMC meeting was perceived as sounding ‘dovish’ and Fed funds rate projections were cut, the Fed still expects to hike at least twice this year. On our side, we continue to look for two rate hikes this year, the first probably […]

United States: we remain optimistic on consumption growth in 2016

Nominal total retail sales rose by 0.2% m-o-m in January, slightly above consensus expectations (+0.1%). Moreover, December’s number was revised up from -0.1% to +0.2%. Total sales were dented by a 3.1% m-o-m fall in nominal sales at gasoline stations (on the back of lower gasoline prices). Nominal auto sales increased by 0.6% m-o-m, in […]

2016 off to a turbulent start

A market rebound now appears to be under way. Internal market dynamics suggested that conditions were ripe for this, and central banks seem to have provided the trigger that markets were looking for.

US wages & monetary policy: not-so-dovish FOMC statement in January

Besides GDP data, today saw some other key data being published: the quarterly Employment Cost Index (ECI), admittedly the most reliable measure of wages and salaries. Following Wednesday’s less-dovish-than-hoped FOMC statement, prolonged uncertainty over inflation prospects and seemingly some modest pick-up in average hourly earnings increases – the other main statistic on wages – publication […]

We expect the Fed to remain on hold in March and that it will hike ‘only’ twice this year

After its meeting earlier this week, the Federal Open Market Committee (FOMC) published a statement where, as widely expected, it acknowledged that “economic growth slowed late last year”. It also added a comment that “the Committee is closely monitoring global economic and financial developments and is assessing their implications for the labor market and inflation, […]

United States: Fed short-term rates projections revised significantly up

The surprise came from Fed rate projections. They were revised significantly up, which contributed to pushing Treasury bond yields up. The FOMC statement and press conference confirmed that the Fed remains upbeat on the economy and that there would have to be a barrage of further economic setbacks before it decided to call a halt […]

Back to the nineties

Yves Bonzon sees the US market no longer responding to QE moves by the Fed, suggesting that while a correction in equities and Treasuries may come in the summer, the year should still progress positively.

US job creation surprisingly soft in December 2013

US non-farm payroll employment rose by only 74,000 m-o-m in December 2013, well below consensus expectations (+197,000). However, November’s figure was revised up by 38,000 (from 203,000 to 241,000). As this series on job creation is often very volatile (see chart above), we should not read too much into short-term changes in job creation. This […]

The Fed: ‘Tapering’ with care

It was becoming increasingly clear that the Fed wanted to make a start soon on scaling back its purchases of assets under QE3 but, in parallel, it wished to convince all and sundry that tapering does not equate to monetary tightening. With these objectives in mind, yesterday’s ‘tapering’ announcement was clearly a success. Modest ‘tapering’ […]

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