Markets think falling inflation means rate cuts are around the corner. Here's why that's probably wrong.
"I don't think it's misplaced to think that there are cuts coming. But the speed — July pricing in cuts — that's not happening," Mike Skordeles, head of US economics at Truist Advisory Services, told Insider in an interview.
Meanwhile, the labor market remains robust, setting up the Fed to pause on rates until at least the end of 2023, Skordeles said. There's even a slight chance that another rate hike in June is in play, he added. That's when policymakers thought they got a handle on high inflation after an initial round of rate hikes. Then they cut rates and inflation re-accelerated.
Investors are also watching if Congress will lift the $31 trillion debt ceiling, with a deadline looming as soon as June 1. Failure to do isMeanwhile, a raft of data is due before the Fed meets again June 13-14, including the PCE inflation figure and the May jobs report. Traders foresee a nearly 90% chance the Fed will hold its key rate at 5%-5.25% in June.
Malaysia Latest News, Malaysia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Fed's Jefferson, Biden's vice chair pick, says Fed 'on track'The Federal Reserve is 'on track' to doing what is necessary to meet the two mandates Congress has given it, Fed Governor Philip Jefferson said on Friday: bring inflation down and enable Americans who want jobs to get them.
Read more »
Biden nominates Jefferson as Fed vice chair, Kugler to Fed boardU.S. President Joe Biden on Friday nominated Federal Reserve Governor Philip Jefferson to be the central bank's vice chair, a key policy advisory role recently vacated when Lael Brainard took a top position in Biden's White House economics team.
Read more »
President Biden announces nominations for key positions at Federal ReserveU.S. President Joe Biden nominated Philip Jefferson as Fed vice chair, Adriana Kugler as a Fed board member, and current Fed governor Lisa Cook for a full term.
Read more »
Forex Today: Dollar strengthens on mixed markets, commodities under pressureMarket participants will continue to digest the latest inflation numbers across the globe and the resurgence of US bank fears. Regarding data, the New
Read more »
Asia markets to trade mixed as U.S. inflation shows more signs of easingU.S. producer prices came lower than expected as inflation pressures ease
Read more »
Asian markets mostly lower on looming worries over U.S. banks, China growthAsian shares were mostly lower Friday on looming worries over U.S. banks and lagging demand from China, the region's major driver of growth.
Read more »