Federal Funds Rate

Optimistic Spin: Bond Market Pricing Better-Than-Expected Economic Growth

Sep 30, 2026 4 min read paid

Bond yields rose yet again today even though September's PCED inflation report showed some improvement, which was due mostly to new measurement procedures. Inflation remains about a percentage point above the Fed's 2.0% target. Other economic indicators today confirmed that the economy and the labor market are doing very well and strengthened the case for more Fed rate hikes. Yesterday's dovish suggestion by

Ed Yardeni
Elias Griepentrog

Warsh, Rinse, Repeat

Apr 22, 2026 5 min read paid

We are Fed Watchers. In his Senate Banking Committee hearing yesterday, Kevin Warsh suggested that under his leadership, we might have less to watch. He advocated ending current "forward guidance" practices, which means no more quarterly Summary of Economic Projections, including the Dot Plot (chart). He suggested that a press conference after FOMC meetings should only be held when there is "important news" to deliver, rather

Ed Yardeni
Elias Griepentrog

Powell Says: ‘I Have Nothing On That For You’

Jan 28, 2026 2 min read

Fed Chair Jerome Powell didn't have much to say at his press conference today. He deflected several questions about the transition as his term as Fed chair ends on May 15. He refused to comment on President Donald Trump's potential pick to replace him or the President's public criticisms of his leadership. He declined to comment on the Department of Justice investigation into himself

Ed Yardeni

Why Cooler Inflation Isn't Lifting Markets

Mar 13, 2025 2 min read paid

February's inflation data provided conflicting stories. Both the CPI and PPI came in cooler than expected, but neither cheered the stock and bond markets. That's because the components of both gauges that feed into the Fed's preferred PCED inflation rate were actually a bit hotter. In addition, January's PPI increase was revised up from 0.4% to 0.6%. So it'

Ed Yardeni

Fed's Hawkish Rate Cut Triggers Pausing Tantrum

Dec 18, 2024 3 min read paid

The Federal Open Market Committee (FOMC) cut the federal funds rate (FFR) by 25bps today, as widely expected. That takes the target range for the overnight rate down from 5.25%-5.50% to 4.25%-4.50%, a full percentage point lower since the Fed's rate cutting cycle started on September 18. A cut was all but guaranteed. Yet the S&P 500 fell almost 3%

Ed Yardeni

Powell's Mixed Message Remains Dovish

Nov 7, 2024 3 min read

The Federal Open Market Committee (FOMC) cut the federal funds rate (FFR) by 25bps today as widely expected. We expected it as well, though we still believe that the now 75bps cut in the FFR since September 18 is too much, too soon because both the economy and the labor market remain strong. In his press conference today, Fed Chair Jerome Powell acknowledged several times that both remain solid. He

Ed Yardeni

Bond Vigilantes Started Voting Early

Oct 23, 2024 3 min read

The US presidential and congressional elections aren't until November 5, but the Bond Vigilantes are voting early. The 10-year US Treasury bond yield has risen a whopping 63 basis points to 4.25% since the Fed's September 17-18 meeting (chart). In exit polls, the Bond Vigilantes are saying they are voting against Fed Chair Jerome Powell's dovish monetary policy because the economy

Ed Yardeni

Powell Declares Mission Accomplished

Sep 18, 2024 3 min read

The Fed cut the federal funds rate (FFR) by 50bps today. This marks the end of the Fed’s monetary policy tightening cycle that started during March 2022, which was aimed at bringing inflation back down to 2.0% even if that caused a recession. Inflation isn't quite there yet, but it is close enough. So today, in his presser, Fed Chair Jerome Powell reiterated that the Fed&

Ed Yardeni

Fed Easing Monetary Policy Into An Economic Boom?

Sep 16, 2024 2 min read paid

Ed Yardeni

Fed Not Even Thinking About Thinking About Cutting Rates

Nov 21, 2023 2 min read paid

That's the basic message of the FOMC's minutes released today. The word "restrictive" was mentioned seven times mostly in the following context: "In discussing the policy outlook, participants continued to judge that it was critical that the stance of monetary policy be kept sufficiently restrictive to return inflation to the Committee’s 2 percent objective over time." The core PCED was up

Ed Yardeni

Market Call: Refreshing Pause For Bulls & Reindeer

Nov 19, 2023 2 min read paid

The federal funds rate futures market is anticipating two 25bps cuts in the federal funds rate over the next 12 months (chart). That makes sense to us and is consistent with the September FOMC's Summary of Economic Projections. More rate cuts could occur if a recession is coming our way in 2024, but that's not our forecast. We still think that the 10-year Treasury bond

Stephen Rybka

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