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US payrolls fails to resolve the 25 or 50bp rate cut call
The jobs report provides a real mix of numbers that does little to resolve the debate over whether the Fed will cut rates by 25bp or 50bp on 18 September. We have a 50bp in our forecast, but it is a low conviction call made on the basis that inflation fears have receded and the Fed will want to get ahead of labour market weakness, which we think will become increasingly apparent in the months ahead. In terms of the August numbers, headline non-farm payrolls rose 142k versus the 165k consensus, so a slight downside miss, but there were 86k of downward revisions to the past two months. We are seeing consistent downward ... (full story)
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Plant Vogtle, a nuclear power plant in Waynesboro, Georgia, is the largest source of clean energy in the U.S. following the addition of two new reactors, according to Georgia ...
post: FED'S WILLIAMS: THERE IS STILL SIGNIFICANT TAILWINDS ON SUPPLY SIDE OF ECONOMY. post: *WILLIAMS: PATH OF CUTS MUST BE DRIVEN BY DATA AND RISKS
post: FED''S WILLIAMS: JOBS DATA IS CONSISTENT WITH A COOLING ECONOMY. post: FED'S WILLIAMS: I WANT TO LOOK AT LATEST JOBS REPORT DATA MORE CLOSELY. post: FED'S WILLIAMS: LOWERING RATES IS ABOUT HELP KEEP JOB MARKET IN BALANCE post: Williams seems fine with 25. Pressed over why the Fed isn't in a bigger hurry to get rates down to neutral, Williams says that monetary policy is "well positioned" and "on a path" that can prevent undesirable weakness in the labor market.
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post: *WILLIAMS: DON'T HAVE PERSONAL VIEW ON 25BPS VS 50BPS CUT YET *WILLIAMS: FED HAS NO GENERAL PRINCIPLE ON FAST VS GRADUAL MOVES post: FED'S WILLIAMS: IT IS CLEAR RATES SHOULD FALL, BUT PACE, DESTINATION LESS CLEAR. post: FED'S WILLIAMS: IT'S CLEAR LABOR MARKET IMBALANCES HAVE EASED. post: FED'S WILLIAMS: THE JOBS MARKET MORE CONSISTENT WITH PRE-PANDEMIC ENVIRONMENT.
Thank you, Eric, and thank you for the opportunity to speak to you today.1 My topic is the outlook for the U.S. economy and the implications for monetary policy, a set of judgements that have, of course, been influenced by this morning's jobs report. When I scheduled this speech several months ago, I knew it might be challenging to speak a few hours after the release of such an important piece of data. But we like to say that monetary policy must be nimble, so that means policymakers must be nimble also. Not Simone Biles nimble, but nimble. As you will hear, I believe the data we have received this week reinforces the view that there has been continued moderation in the labor market. In light of the considerable and ongoing progress toward the Federal Open Market Committee's 2 percent inflation goal, I believe that the balance of risks has shifted toward the employment side of our dual mandate, and that monetary policy needs to adjust accordingly. Looking back at the economic data over the first six months of 2024, it portrayed an economy slowly cooling and not showing signs of significant weakening. The labor market had been gradually moderating for the past year or so, and although inflation rose in the first quarter, it then retreated in the second, and there was a widespread view heading into the second half of the year that the FOMC was on track to achieve a much desired but unusual "soft landing." Then the July jobs report came in unexpectedly soft. Job creation slowed and the unemployment rate increased by two tenths of a percentage point to 4.3 percent, the highest since October 2021. There was speculation that weather-related issues might have distorted these results and, in fact, the unemployment rate ticked down in this morning's release. But, overall, the August report along with other recent labor data tend to confirm that there has been a continued moderation in the labor market. The ups and downs in the data over time post: WALLER: AM OPEN MINDED ON SIZE AND PACE OF CUTS, WILL DEPEND ON DATA post: *FED’S WALLER: TIME TO CUT RATES AT UPCOMING MEETING post: *FED’S WALLER: IF APPROPRIATE, WILL ADVOCATE FOR ‘FRONT-LOADING’ CUTS post: FED'S WALLER: IT IS LIKELY A SERIES OF REDUCTIONS IN POLICY RATE WILL BE APPROPRIATE.
Federal Reserve Board Governor Chris Waller as he delivers his views on the state of the economy and the proper stance of monetary policy. Following his speech, he will take ...
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- Posted: Sep 6, 2024 10:26am
- Submitted by:Category: Fundamental AnalysisComments: 0 / Views: 5,665
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