Price stability for the past three decades has been defined as a 2% inflation target, far below the elevated levels of the past year. Now, after a year of aggressively raising interest rates to bring down inflation, the Federal Reserve faces the monumental choice on when to pause its rate hikes. On ... READ MORE >
Jerome Powell
Job openings rise again in December, adding to pressure on the Fed
Labor demand surged again in December after two consecutive drops, according to government data released on Wednesday hours ahead of the Federal Reserve's rate decision. The number of job vacancies jumped to 11 million in December from 10.4 million, mostly driven by seasonal-related categories like ... READ MORE >
FOMC preview: Fed to slow pace of rate hikes to 25 basis points
The easing of inflationary pressures, a slower pace of consumer spending and hiring, and the moderation of wage increases are coalescing in such a fashion that the Federal Open Market Committee next week should be comfortable slowing its rate increases. We anticipate that the FOMC will increase its ... READ MORE >
U.S. inflation eases in December, supporting a moderation in Fed rate hikes
A third straight month of improvement in top-line inflation data implies that conditions are moving in the direction where the Federal Reserve can consider further moderation in the pace of its rate hike campaign to restore price stability. The tone and tenor of the data imply an underlying ... READ MORE >
U.S. economy generates 4.5 million jobs in 2022 as labor market remains hot
If one would have asked a year ago if the economy would expand at above a 2.5% clip and produce 4.52 million jobs by the end of the year, all while the Federal Reserve raised its policy rate by 450 basis points, the answer would probably have been no. But that is just where the economy stands ... READ MORE >
FOMC decision: Fed lifts policy rate to range of 4.25% to 4.5%
The Federal Reserve on Wednesday laid the groundwork for an eventual pause in interest rate increases early next year, even as it indicated it intends to continue lifting rates into a slowdown. The projection of a slowdown, which is in the Summary of Economic Projections released after the Federal ... READ MORE >
When will inflation slow? Pay attention to housing.
A correction in the housing market as mortgage rates reach 20-year highs is underway. While overall price growth has cooled, though, the housing components inside the two inflation reports—the Consumer Price Index and the Personal Consumption Expenditures price index—have shown no signs of ... READ MORE >
Fed raises its policy rate by 75 basis points as it prepares to slow pace of hikes
The Federal Reserve increased its policy rate by 75 basis points on Wednesday to a range between 3.75% and 4% as it hinted at slowing the pace of its hikes while it assesses the impact of past increases. We expect at least a 50-basis-point hike in December, another 50-point hike in January and then ... READ MORE >
Job openings and manufacturing production grow more than expected
Job openings came in hotter than expected in September, suggesting that the imbalance in the labor market will take longer to resolve than originally anticipated. There were 1.9 job vacancies for each unemployed worker, near a record high, according to data from the Labor Department released ... READ MORE >
Powell at Jackson Hole: From era of abundance to one of insufficient supply
The pandemic has been the catalyst for a seismic shift in the American economy as it shifts from an era of abundance to one of insufficient supply. For households, this implies a shift from what we call rational inattention regarding consumption to a more rational approach to spending. As ... READ MORE >