Macro Views We were not surprised by the FOMC’s decision to hold rates unchanged yesterday but were surprised by their frankness and that of Janet Yellen in her press conference with which they’ve admitted that China and market volatility are, today, important drivers of their decision making. We now expect the first interest rate hike […]

Perspectivas Macro Nos sentimos más seguros ahora que hace dos semanas de que la Fed mantendrá su tasa objetivo de fondos federales en 0.00–0.25% el jueves 17 de septiembre. La volatilidad del mercado por sí sola ha endurecido las condiciones financieras, elevando el costo del capital y haciendo más peligroso asumir riesgos. Con un alto […]

Macro Views We feel surer now than we did two weeks ago that the Fed will hold its target federal funds rates at 0.00–0.25% on Thursday 17 September. Market volatility on its own has tightened financial conditions, raising the cost of capital and rendering risk taking more treacherous. With high uncertainty, we now forecast that the […]

Macro Views After prolonged agony, we have shifted our forecast for the timing of the first Fed hike to October from September. We premise this forecast on the assumption that markets will start recovering in October and U.S. macro data will continue to signal expansion, especially in the service sector. Why the change? We think […]

Tim Duy speculates as to what it would mean if the FOMC hiked rates by 25 basis points to 0.25–0.50% on September 17 even though inflation is below and diverging away from the 2% Fed target and no observable signs have emerged that inflation pressures are building. He argues that an initial 25 basis-point lift-off […]