Fed

Will Nvidia Trump The Fed?

May 23, 2024 2 min read paid

Yesterday's FOMC minutes confirmed that Fed officials are in no rush to lower the federal funds rate (FFR) and some are considering the possibility that they might have to raise it if inflation stalls above the Fed's 2.0% target. The 2-year Treasury yield is back up to 4.94% implying one 25bps rate cut over the next 12 months. So stocks sold off on

Ed Yardeni

The Recession Claim

May 9, 2024 2 min read

One of our competitors claims that we are in a recession. Another claims that we will soon be in a recession. The most widely anticipated recession of all times is turning into the longest widely anticipated recession of all times. One day, the diehard hard-landers will be right. Was today the day? We're sure that their heartbeats quickened on today's jobless claims report. Consider the

Ed Yardeni

Powell Says No Stag, No Flation.

May 1, 2024 2 min read paid

Fed Chair Jerome Powell wasn't dovish at his presser today. But he wasn't hawkish either. He said, "I think it's unlikely that the next policy rate move will be a hike." The 2-year Treasury yield fell back below 5.00% to 4.98%, consistent with one 25bps cut in the federal funds rate over the next twelve months. The S&

Ed Yardeni

Look For The Union Label In Latest ECI Inflation Rate

Apr 30, 2024 2 min read paid

Today's Employment Cost Index (ECI) for Q1 was another hotter-than-expect inflation report. It came out just as the FOMC started its latest meeting to discuss monetary policy. It increases the odds that Fed officials will sound more hawkish starting with Fed Chair Jerome Powell at his presser tomorrow following the meeting. Stocks sold off hard as the 2-year Treasury note yield rose back above 5.

Ed Yardeni

Monetary Policy Is In A 'Good Place'

Apr 18, 2024 2 min read paid

Ed Yardeni

Hawks Fly Higher For Longer Than Doves

Apr 16, 2024 2 min read paid

It's official: Fed Chair Jerome Powell confirmed today that he and his colleagues aren't convinced that inflation is coming down fast enough to consider cutting the federal funds rate (FFR) any time soon: "The recent data have clearly not given us greater confidence and instead indicate that it is likely to take longer than expected to achieve that confidence," Powell said at a moderated

Ed Yardeni

The Last Mile

Apr 10, 2024 3 min read paid

Will the Fed start raising the federal funds rate again? We expect to be hearing this question more often following today's hotter-than-expected CPI inflation report. The previous two reports for January and February were also hotter-than-expected. We don't think that the Fed will raise rates again this year, but we've pushed back against the widely-held notion of several cuts

Ed Yardeni

Loose Fed Lips Sink Stocks

Apr 4, 2024 2 min read paid

We are in the same camp as Federal Reserve Bank of Minneapolis President Neel Kashkari. On March 6, he said, "If we have a run rate that's very attractive, people have jobs, businesses are doing well, inflation is coming back down, why do anything?" We wrote an op-ed in the March 25 Financial Times titled, "The Fed should resist messing with success." We

Ed Yardeni

Market Call: Fed Choir All On Same Page

Mar 31, 2024 2 min read paid

Fed Chair Jerome Powell spoke on Friday at an event at the San Francisco Fed. He repeated what other Fed officials have been saying recently. Solid economic growth gives the Fed "the chance to just be a little more confident about inflation coming down before we take the important step of cutting rates." Inflation continues to moderate on a "sometimes bumpy" path. So there's

Ed Yardeni

'There's Still No Rush'

Mar 27, 2024 2 min read paid

So said Federal Reserve Governor Christopher Waller this evening at the Economic Club of New York in a speech titled “There’s Still No Rush.” He noted that the latest inflation figures were "disappointing" and that the economy and labor market remain strong. So, in his opinion, "it is appropriate to reduce the overall number of rate cuts or push them further into the future in response

Ed Yardeni

Market Call: The Fed Put Is Back

Mar 24, 2024 2 min read paid

Last week, the FOMC released its latest quarterly Summary of Economic Projections (SEP) for March. Compared to December's SEP, the committee's participants raised their 2024 median forecasts for real GDP (from 1.4% to 2.1%) and for the core PCED inflation rate (from 2.4% to 2.6%). Their median forecast for the unemployment rate was lowered a bit from 4.1% to 4.0%

Ed Yardeni

Powell & Co. Remain Dovish

Mar 20, 2024 3 min read

Powell & Co. were more dovish today than we (and stock investors) expected. The FOMC's Summary of Economic Projections (SEP) still implied three 25bps cuts in the federal funds rate (FFR) this year (table). That's the same projection as in December's SEP even though the median forecast was raised for real GDP growth (to 2.1% from 1.4%) and the core PCE inflation

Ed Yardeni

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