July 2023 FOMC: Another 25bps

The Fed raised rates for the 11th time in 16 months, bumping rates +25bp to 5.25%-5.5% at today’s FOMC meeting. This matched the market consensus and puts short-term rates at a 22-year high (last seen January 2001).  The Fed kept the statement the same in regard to...

The Fed is Still on Alert

With many declaring the Fed’s work done, we thought it made sense to discuss the challenges that still remain in this hiking cycle. The headline inflation numbers have been hammered down, but underlying conditions still give them the backdrop to try putting the...

Fed and Treasury on Collision Course

QT Slowly Eating Away Liquidity   Even with the spike in the Fed’s Balance sheet following the SIVB (Silicon Valley Bank) collapse, QT is still quietly going on in the background. The Fed has stayed course in their communication of the importance of shrinking...

Can Inflation Slow Without Economic Damage?

  Source: Strategas as of 06.20.2023   Many of the underlying sources of inflation have cooled over the past year. Supply chains have improved, interest rate sensitive sectors are seeing slower growth, but is it enough to get to the fed’s 2% target? The...

June FOMC Recap & Thoughts

The “Hawkish” Pause   Yesterday the Fed left their target for the funds rate unchanged between 5% to 5.25%. Many labeled the pause a hawkish “skip” where further tightening is expected. The Fed DOT plot signaled that there could be two more rate hikes in 2023. QT...

May CPI: Easier Inflation Comps Ending

Year-over-year CPI declined in May, roughly in line with estimates:   Headline MoM: +0.1% (Expected: +0.1%) Core MoM: +0.4% (Expected +0.4%) Headline YoY: +4.0% (Expected: 4.0%) Core YoY: +5.3% (Expecting 5.2%)   Top/Bottom Contributors:   Source:...