The Federal Open Market Committee (FOMC) has voted to reduce the interest rate by 0.50% after having maintained its benchmark rate within the range of 5.25% to 5.50% since July 2023 The previous rate was the highest seen for 23 years and remained unchanged even though the Fed’s favoured inflationRead More →
As anticipated in the U.S., prices rose in August 2024, while the annual inflation rate fell to its lowest point since February 2021, according to a Labor Department report on Wednesday 11th September 2024. This development likely now paves the way for a Federal Reserve interest rate reduction next weekRead More →
Is the U.S. economy already weaker than the headline data suggests and should the U.S. Federal Reserve already be easing? In the U.S. recent data (Friday 30th August 2024) showed the personal consumption expenditures (PCE) price index, the Federal Reserve’s favored measure of inflation, ticked up 0.2% last month, asRead More →
The Dow Jones Industrial Average (DJIA) reached a new record high on Monday 26th August 2024, closing at 41240. Investors have responded positively to the Federal Reserve’s recent indications that interest rate cuts are highly probable to commence in September 2024. Market dynamics and sentiment The rise of the DJIARead More →
No surprise here then as the Fed have been signalling a cut for some time now The Fed summary stated: “The vast majority” of participants at the July 30-31 meeting “observed that, if the data continued to come in about as expected, it would likely be appropriate to ease policyRead More →
U.S. consumer prices (CPI) increased at the slowest rate in over three years last month, further supporting the argument for the Fed to begin reducing interest rates. According to the U.S. Labor Department, prices climbed 2.9% in the 12 months leading up to July 2024, marking the smallest yearly riseRead More →
Has the Fed over-cooked it this time by waiting too long to reduce interest rates? U.S. stock markets threw a wobbly after the latest employment data and after the Fed delayed its first rate cut… again. September 2024 now looks likely for that first cut – but by how much:Read More →
FOMC hold rates steady at 5.25% – 5.50% Federal Reserve Chair Jerome Powell ended a press conference in which he gave markets exactly what they wanted; a strong indication of a September 2024 rate cut. Powell says September 2024 rate cut ‘on the table’ if inflation continues to cool. FederalRead More →
Gold prices climbed to $2,482 per ounce, hitting an all-time high. Gold prices continued to peak at new record highs Tuesday and Wednesday 15th and 16th July 2024. On Monday 15th July 2024, Powell reportedly said the Fed won’t wait for inflation to reach the central bank’s 2% target before it begins cutting,Read More →
Jerome Powell appears to be further paving the way for a rate cut at the next meeting in July 2024. Federal Reserve Chair Jerome Powell reportedly said Monday 15th July 2024 that the central bank will not wait until inflation hits 2% to cut interest rates. Powell referenced the idea that centralRead More →
Jerome Powell on Tuesday 9th July 2024 reportedly expressed concern that holding interest rates too high for too long could jeopardize economic growth. This comment came ahead of the consumer price index reading due this week. Preparing for a two-day session on Capitol Hill, the central bank chief stated thatRead More →
The ‘Sahm Rule’ serves as a heuristic indicator employed by the Federal Reserve to ascertain the onset of a recession in the economy. The Sahm Rule is a real-time evaluation tool based on monthly unemployment data from the Bureau of Labor Statistics (BLS). Named after economist Claudia Sahm, it forecastsRead More →
The U.S. economy exceeded job growth expectations in May 2024, alleviating concerns of a labour market downturn but potentially diminishing the Federal Reserve’s motivation to cut interest rates. Non-farm payrolls surged by 272,000 for the month – a significant increase from April’s 165,000 and surpassing the consensus forecast of 190,000.Read More →
Bad economic news appears to have had an interesting impact on the stock market recently. Traditionally, negative economic data might be anticipated to result in falling stock prices; however, recent trends have diverged from this norm. News trend In the past two months, negative economic news has had a paradoxically positiveRead More →
The decision comes as inflation, which measures price rises over a period of time, remains above the Bank’s 2% target at 3.2%. But bank says cuts are coming. Is the 2% target still a sensible benchmark? The 2% inflation target set by central banks has been a widely adopted benchmarkRead More →
The Fed have deliberated over ‘transitory’ inflation – (they got that wrong). They have teased us about when rates will be cut (still waiting). And now we are told no rate cut but: ‘the next rate move is unlikely to be up!’ Probably better to say and do nothing atRead More →
Inflation has become a persistent challenge for the Fed The battle against inflation persists, gradually impacting the U.S. economy and presenting substantial challenges for the Federal Reserve. Despite concerted efforts to control it, inflation remains stubbornly remains, leaving policymakers in a dilemma – to stimulate economic growth or to curbRead More →
The U.S. economy is on a rip, with employers adding around 303,000 jobs in March 2024 – the largest increase in almost a year. As the world’s largest economy continues to surge, questions arise about the Federal Reserve’s next move regarding interest rates. Stronger-than-expected Job Growth The unemployment rate fellRead More →
Federal Reserve Chairman Jerome Powell stated on Wednesday 3rd April 2024 that policymakers will need time to assess the current inflation situation, leaving the schedule for potential interest rate reductions unclear. Referring to the stronger-than-anticipated price pressures at the year’s onset, Powell reportedly stated that he and his colleagues areRead More →
The Fed in March 2024, indicated for the markets to expect three interest rate cuts by the end of 2024 – but what if this didn’t happen? The Federal Reserve’s decision to maintain interest rates in 2024 could have significant implications for the U.S. economy. Fed cred – credibility wouldRead More →
Federal Reserve Chair Jerome Powell said in a U.S. TV interview on Sunday 4th January 2024 that the central bank will proceed carefully with interest rate cuts this year and likely will move at a considerably slower pace than the market expects. Election year rate cuts? In the interview andRead More →
The Federal Open Market Committee (FOMC) held interest rates steady and indicated a willingness stop raising interest rates. But a cut anytime soon is unlikely until inflation is brought fully under control and nearer to the Fed’s 2% inflation target. The Federal Reserve sent a signal that it is finishedRead More →
Federal Reserve officials in December concluded that interest rate cuts are likely in 2024, though they appeared to provide little in the way of when that might occur, according to minutes from the meeting released Wednesday 3rd January 2024. FOMC meeting minutes The rate-setting Federal Open Market Committee (FOMC) agreed to keepRead More →
The Dow Jones Industrial Average (DJIA) hit a new all-time high, on 13th December 2023. It closed at 36799 surpassing its previous record of 36585points that it had set on 4th January 2022. This was the fourth consecutive record close for the index. Record high The Dow’s record high was driven primarily by theRead More →
Fed holds U.S. rates at 5.5%, indicates three cuts coming in 2024 The Federal Reserve on Wednesday 13th December 2023 held its key interest rate steady for the third time in a row and set the scene for multiple rate cuts in 2024 and 2025. With inflation easing and theRead More →
Fed Chair Jerome Powell reportedly said he and his colleagues remain steadfast in getting policy in line with their 2% inflation target, but ‘we are not confident that we have achieved such a stance’. He stressed the Fed nevertheless can be cautious as the risks between doing too much andRead More →