Federal Reserve Bank of New York President John Williams said he still sees one more interest-rate hike as appropriate this year
However, at the moment, he does NOT believe it will be necessary for the central bank to increase rates again in 2027. John Williams is widely considered a centrist on monetary policy, though he often tilts dovish compared to the rest of the market Source: Gregory Daco
BLACKROCK JUST CUT US STOCKS TO NEUTRAL AND TURNED BULLISH ON TREASURIES
The shift comes from a note by the BlackRock Investment Institute and CIO Rick Rieder. - Short-term Treasuries: up to overweight - Long-term Treasuries: up to neutral from underweight - US stocks: down to neutral from a long-held overweight BlackRock says it is still bullish on AI and calls the stock cut short-term risk management: "We are managing near-term risk, not changing our core convictions." Source. Evan
ALL 19 Fed officials BACKED a 25bp RATE HIKE in September.
Most officials also said ANOTHER rate increase would likely be appropriate by YEAR-END. Almost all saw inflation risks tilted to the upside, with some warning the AI investment boom could push demand beyond supply and add further price pressure. The Fed also sees the labor market near full employment, while financial conditions remain supportive despite higher Treasury yields. Source: Coinbureau
The top 10 central bank gold reserves
Source: Hedgeye Bloomberg
Fed rate hike odds dropped from 70% to 23% in just 4 days as FED officials hint at a pause.
Source: Bull Theory
"Bond Traders can stop panicking when the Fed starts panicking."
NY Fed Pres John Williams speech yesterday (below) pushed the prob. of a down to hike to 44% (chart). ------------------------------------------------------ New Fed guidance: “There is no need for urgency.” John Williams, the vice chair of the FOMC, delivers notably precise pushback in guiding against an October rate hike that has been getting priced by investors. He lays out his base case: One more hike “may be appropriate late this year.” Here is the key passage from the NY Fed president’s prepared remarks on Tuesday afternoon: “With the policy action we took at our September meeting, there is no need for urgency, and we have time to gather more information. The accumulation of more data should provide greater clarity on the underlying trends in the economy and the associated risks to achieving our goals—and thereby the appropriate setting of monetary policy.” “If the economy evolves in a manner broadly consistent with my forecast, one further upward adjustment of the federal funds target range may be appropriate late this year to support a timelier return of inflation to target. But that is just my forecast, and time—and the totality of the data—will tell.” Source: Jim Bianco, Nick Timiraos
Another day, another multi decade high for US bond yields
Interestingly, US10Y, US20Y, and US30Y have all jumped by 40 bps on average ever since the Treasury Secretary said "I am the house now, bet against me if you dare" US10Y is now the highest since 2007. US20Y and US30Y are both the highest since 2002. Turns out the bond vigilantes took that dare. Source: Bull Theory
The market now dramatically more hawkishly priced than The Fed's Dots (specifically repricing The Fed's terminal rate expectations)...
Source: zerohedge
