Japan wanted to prevent a disorderly depreciation of the yen. The U.S. wanted to suppress the increase in Treasury yields and avoid a selloff by Japan. But it won’t last. … READ MORE >
Market Minute: The Warsh effect and U.S. financial conditions
Fed Chair Kevin Warsh says he wants the financial markets to figure it all out without the forward guidance of the Fed. … READ MORE >
Don’t be misled by slowing GDP. The economy is strong.
Gross domestic product slowed to 1.5% in the second quarter in the United States, but a large part of that slowdown can be attributed to a significant increase in the trade deficit related to the AI buildout. … READ MORE >
A hawkish Fed holds rates steady amid growing dissent
The three dissents in the 9-3 vote, though, came from regional presidents— Neel Kashkari, Lorie Logan and Beth Hammack—and not from the Board of Governors. … READ MORE >
India’s industrial output jumps to a two-year high in June
The upside surprise, though, is unlikely to move the Reserve Bank of India off its expected hold at its policy meeting next week. … READ MORE >
Market Minute: Expect second-quarter GDP to increase by 2.3%
Two events added to the quarter’s demand: Amazon’s Prime Day and the opening weeks of the World Cup. … READ MORE >
Market Minute: Will Warsh be more specific about inflation?
Federal Reserve Chair Kevin Warsh will face tough questions on inflation after Wednesday’s FOMC meeting. How direct will he be in answering them? … READ MORE >
Parsimony is a feature, not a bug, at the new Fed
The major change in the Fed’s approach has been the partial removal of forward guidance. The result is rising uncertainty and volatility in the 2-year Treasury. … READ MORE >
Market Minute: Is public debt crowding out corporate issuance? Not yet.
Despite a large increase in private sector paper linked to AI, public issuance of debt does not appear to be crowding out private sector needs. … READ MORE >
Market Minute: Yen heading toward 170 on the dollar
Rational overshooting in the forex market will most likely send the yen to 170 or above versus the dollar as investors test the mettle of the new Takaichi government. … READ MORE >