Live look at JP Morgan after being the only ones who correctly predicted a 50bps cut:
Source: Trend Spider
Amazing to see the effect of 818K downward jobs revision on the fed dots...
Source: www.zerohedge.com
Among the reasons why the Fed cut 50bps this week:
1) Inflation risk is LOWER than Employment and Consumer risk 2) The sticky component of inflation is shelter. For shelter inflation to go down we need to see more housing supply and for this we need to get lower mortgage rates = jumbo rate cut does help 3) They MUST get front-end rates lower as this colossal wall of debt matures (source: Lawrence McDonald, Bloomberg)
After yesterday jumbo Fed rate cut (days after core CPI MoM reaccelerarting), who doesn't have this chart in mind???
The Second Wave of Inflation. This is what the Fed is thinking but isn't saying out loud. If you expand the dataset to the CPI's of Western economies, 87% of the time there's a second wave. Source. TS Lombard, Eric Hale
FED cuts rates by 50bp to 4.75%-5% range
The Federal Reserve lowered its benchmark interest rate by a half percentage point Wednesday, in an aggressive start to a policy shift aimed at bolstering the US labor market.Committee sees another half-point of cuts in rest of 2024Policymakers penciled in an additional percentage point of cuts in 2025, according to their median forecast.
Soft landing? Hard landing? Or no landing?
Atlanta Fed Q3 Real GDP growth Nowcast model just hit 3%...
Safe is risky. #DF24
Source: Vala Afshar @ValaAfshar on X, marketoonist.com
The US yield curve continues to steepen.
Yields on 10-year Treasuries are the highest vs 2-year yields going back to 2022. Source: Lisa Abramowitz, Bloomberg
