The Federal Reserve has long insisted that its policy decisions are data dependent, not forecast dependent. For the most part, the mix of data since it paused the rate-cutting campaign in January has justified that strategy. The economy has held up well, with unemployment hovering around historical lows, at 4.2 percent, while inflation has remained…
It may be the calm before the storm, but the markets are heaving a big sigh of relief that the chaotic tariff policy, heightened uncertainty and downbeat household confidence have yet to do significant damage to the job market. True, job growth is slowing, which is to be expected for a number of reasons. An…
With the courts echoing President Trump’s on-again, off-again tariff decrees, the only sure thing the markets can count on is that the prolonged period of uncertainty is poised to continue. For now, Trump’s latest iteration of tariffs remains in effect thanks to the appeals court ruling on Thursday pausing a lower court order that would…
The highlight of the week once again came out of Washington, and this time it did not only involve tariffs. On Thursday, House Republicans narrowly passed a major reconciliation bill to deliver President Donald Trump’s economic agenda. However, it’s up to Senate Republicans to craft their own version, which will likely differ from the House…
The stagflation case lost some credibility this week, as fresh data revealed an economy that remains resilient and an inflation backdrop that is once again cooling. Meanwhile, tariffs continue to dominate the headlines, highlighted by a d’tente between the U.S. and China that dialed back the onerous reciprocal levies before the ink on their announcements…
The Federal Reserve’s policy meeting took center stage amid a light data calendar this week. With no quarterly projections to mull over (the next Summary of Economic Projections will be released at the June 17-18 meeting) and no rate changes expected, the markets were laser focused on messaging, emanating from both the policy statement and,…
Despite ominous signs of a slumping economy, linked to tariff anxiety, the supporting evidence has yet to appear. True, the broadest measure of the economy’s overall performance in the first quarter suggests otherwise as GDP contracted for the first time in three years. But besides being backward looking that headline figure is also misleading as…
By recent standards it was a relatively calm week on the policy front as President Trump dialed down his tariff threats, hinting at a de-escalation of tensions with China, and walked back his attacks on Fed chair Powell. Nothing concrete was put on the books, but the tamer messages emanating from the White House was…
A cynic might say that there is method to the madness that some believe is driving the chaotic tariff blitz roiling the financial markets. While the markets are climbing a wall of worry, the current economy is reaping the benefits of that worry. Simply put, anxious consumers who are expecting higher prices on the things…
The shape-shifting nature of President Trump’s tariff threats continued to roil the financial markets this week, producing one of the wildest gyrations in stock and bond prices seen outside of shock-induced major crises. What’s more, it’s not likely that volatility will subside anytime soon. The sigh of relief when Trump postponed onerous reciprocal tariffs on…