Into the Grinder Managing the path to the first rate cut in this cycle has become more challenging with the inclusion of a greater weight on the growth/jobs outcomes. The most
Monday Morning Notes, 1/22/24 If You Don’t Have Time This Morning The last 10 weeks have been a wild ride. Since we first posited the possibility of a March rate
Managing the Path to the March Meeting Market odds of a March rate cut dropped sharply today to around 50% with the move fueled in part by a strong retail
Low Bar for a March Rate Cut As we expected, Federal Reserve Governor Chris Waller did not endorse a March rate cut. But he most certainly didn’t rule it out.
Tuesday Morning Notes, 1/16/24 If You Don’t Have Time This Morning Fed speakers have provided some minimal pushback on market pricing for a March cut, but key speakers have provided none
A Few Quick Bites Ahead of the CPI Report Considering this progress, I voted to maintain the policy rate at its current level while we continue to monitor the incoming
Monday Morning Notes, 1/8/24 If You Don’t Have Time This Morning The minutes of the December FOMC meeting set the stage for the Fed to signal a March rate cut
Minutes Pave the Way for Rate Cuts While the minutes of the December FOMC meeting did not greenlight a rate cut for the March meeting, they did open the door
Monday Morning Notes, 1/2/24 If You Don’t Have Time This Morning With inflation having collapsed in the second half of 2023, the Fed will begin cutting rates by March to
Monday Morning Notes, 12/18/23 Rather than our traditional Monday note, we are winding down the year with an explanation for the Fed’s pivot, and where it might lead, to ponder
The Fed Pivot The Fed will cut rates by March, meaning that there is a nontrivial possibility of a January cut. We predicated our pivot at the beginning of November
Quick Note on CPI Core CPI inflation came in as expected at 0.3% for November: There is less momentum here than it appears if we strip out shelter and used
Monday Morning Notes, 12/11/23 If You Don’t Have Time This Morning In the beginning of November we took an aggressive position is establishing a baseline scenario that the Fed would
Wait For It Eventually the reality of disinflation will come crashing down on the Fed. It’s just a matter of whether that happens before persistently tight monetary policy sets in
Monday Morning Notes, 11/27/23 If You Don’t Have Time This Morning Although the Fed continues to hold out the risk of another rate hike, almost certainly the last hike for
Fed Minutes Offer Little New Guidance The minutes of the November FOMC minutes offered little in the way of any new insights into the policy path. While FOMC participants still
Monday Morning Notes, 11/20/23 If You Don’t Have Time This Morning The market has started pricing in rate cuts beginning next March well ahead of any Fed movement toward easier
Monday Morning Notes, 11/13/23 If You Don’t Have Time This Morning The Fed is not ready to declare that the rate hike cycle ended in July, but when that happens,
A Quick Note on Financial Conditions and Inflation With the 10-year treasury yield now back down from its highs of 5% to almost the level of the September FOMC meeting there has