Today is Fed Day and Kevin Warsh’s first meeting as new Fed Chair. The expected end of fighting and re-opening of Hormuz in the Middle East has given Kevin Warsh lower energy prices as a wedge to ask FOMC members to adopt a wait-and-see-stance on monetary policy rather than to follow other central banks (ECB, BOJ) in raising short term rates. Money markets continue to expect at least one Fed rate hike (87% chance) by year-end as inflation remains elevated. The forward dot plot of FOMC members could be the most important signal today of Fed thinking rather than the actual policy statement.
Separately May retail sales were above expectations (+0.9% MoM vs +0.6%E MoM) despite higher energy prices signaling continuing strong spending by consumers.
The copyright of this article belongs to the original author/organization.
The views expressed herein are solely those of the author and do not reflect the stance of the platform. The content is intended for investment reference purposes only and shall not be considered as investment advice. Please contact us if you have any questions or suggestions regarding the content services provided by the platform.
