Fed officials aren’t likely to have a serious conversation about cuts this week but the prospect of lower rates is coming into view.
“There are plenty of things that could cause them to say, ‘We’re not in a rush to do this.’”
In the history of modern finance, no single indicator has done a better job of predicting when the next global recession will start than when the Bank of Japan starts raising rates. Foolproof!
May payrolls:
Hiring up by 272,000 in the establishment survey.
But the household survey shows a drop in employment and a rise unemployment, bringing the unemployment rate to 4.0% (unrounded at 3.96% this is the highest since January 2022)
three wars will dominate world affairs:
russia vs ukraine, now in its third year;
israel vs hamas, now in its third month;
the united states vs itself,
ready to kick off at any moment.
#toprisks2024
JD Vance says women who haven’t given birth like Kamala Harris are “childless cat ladies who are miserable at their own lives,” and have “no direct stake” in America.
イエレン財務長官
「為替介入は、非常に稀で例外的な状況でしか容認されない」
👉ドル円155円超えで推移するタイミングで、この発言…。
Yellen: Currency Intervention is Acceptable Only in Very Rare and Exceptional Circumstance
Citi and JPM now expect the Fed to cut rates by 50 bps in Sept, 50 bps in Nov, 25 in Dec.
(Will update this table later today as many of these are now likely getting redrafted.)
On Wednesday, Powell said a 50 basis point cut wasn't something Fed officials wanted to start with.
But he said "something that looks like a more significant downturn ... would be something that we would have the intention of responding to."
日銀の長期金利変動幅引き上げを「引き締め」と判断するなら、「6回目のジンクス」くる?
審議員に就任された高田創氏いわく1970年以降、出口局面は米→欧→日の順で、今回を含めれば6回目。
最後に日本が引き締めに転じた後、世界は景気後退や相場混乱に直面しましたが・・is this time different?
Here is where we are now in the U.S. Treasury Bond Market:
2 Year: 4.52%
5 Year: 4.37%
10 Year: 4.13%
30 Year: 4.13%
Note how the long end is flat. Sign of yield increase exhaustion.
Treasury yields may well be peaking between now and year-end.
Over the past two weeks:
May 7th: Assassination attempt against Saudi Crown Prince.
May 13th: Turkish President Erdoğan holds emergency meeting following warning of possible military coup.
May 15th: Assassination attempt on Slovak PM Robert Fico.
May 16th: Citizen arrested
Fed Chair Powell really opening the door to a September rate cut today:
Powell: The last 3 inflation readings “do add somewhat to confidence."
Powell: "Now that inflation has come down and the labor market has indeed cooled off, we’ll be looking at both mandates."
Bloomberg: per JPMorgan 75% of carry trades are closed as the recent slump wiped out year-to-date gains.
Does this mean the largest ones are still yet to be determined?
#credit
event
#recession
🚨BANK SELL OFF: 📉
As banks report earnings many are warning about credit loss a clear sign the economy is not well as $JPM stated today
“We set aside $3.1 billion in provisions for credit losses, 62% higher📈 than the first quarter.”
MORGAN STANLEY: “.. leading indicators for rents suggest faster disinflation in the rent
#CPI
in 2H24, supporting our team’s view of a downward, albeit bumpy, path for inflation.” [Huberty] 🇺🇸
"One can argue that the BOJ and MOF - having had discussions with Powell and Yellen about this intervention ahead of time - received some assurance that as far the Fed and Treasury are concerned, the US dollar isn't going to spike in the near-future. In fact, one can probably
JPM and Citi scrapped their calls for a July rate cut after last Friday's jobs report.
Most sell-side economists and other professional Fed watchers now anticipate one or two rate cuts this year in either September or December