2018-06-08 13:35:00 Fri ET
federal reserve monetary policy treasury dollar employment inflation interest rate exchange rate macrofinance recession systemic risk economic growth central bank fomc greenback forward guidance euro capital global financial cycle credit cycle yield curve
The Federal Reserve delivers a second interest rate hike to 1.75%-2% and then expects subsequent rate increases in September and December 2018 to dampen inflationary pressures. This decision reflects robust economic revival in America. With sound price stability, the U.S. economy now operates near full employment with 2.1% inflation and 3.8% unemployment (i.e. the lowest unemployment rate since 2000). The current real economic growth trajectory accords with the Federal Reserve's dual mandate of maximum employment and price stability.
The Federal Reserve pencils in subsequent interest rate hikes later in 2018 (2%-2.25% in September 2018 and then 2.25%-2.5% in December 2018). This gradual acceleration of interest rate increases helps contain inflation with steady gains in the labor market. The current interest rate hike might disappoint President Trump who would otherwise prefer dovish monetary policy accommodation (in contrast to hawkish inflation containment).
However, the Federal Reserve reiterates monetary policy independence and thus continues the current interest rate hike as the U.S. economy moves along the long-run steady-state economic growth path of healthy fundamental recalibration. On balance, it is now quite plausible for America to achieve 3%+ real GDP economic growth to better balance the U.S. fiscal budget that helps neutralize both trade and budget deficits in the medium term.
If any of our AYA Analytica financial health memos (FHM), blog posts, ebooks, newsletters, and notifications etc, or any other form of online content curation, involves potential copyright concerns, please feel free to contact us at service@ayafintech.network so that we can remove relevant content in response to any such request within a reasonable time frame.
2019-02-28 20:44:00 Thursday ET
AYA Analytica finbuzz podcast channel on YouTube February 2019 In this podcast, we discuss several topical issues as of February 2019: (1) our proprieta
2017-11-17 09:42:00 Friday ET
The Trump administration garners congressional support from both Senate and the House of Representatives to pass the $1.5 trillion tax overhaul (Tax Cuts &a
2019-04-07 13:39:00 Sunday ET
CNBC news anchor Becky Quick interviews Warren Buffett in early-2019. Buffett explains the fact that book value fluctuations are a metric that has lost rele
2023-06-07 10:27:00 Wednesday ET
Anat Admati and Martin Hellwig raise broad critical issues about bank capital regulation and asset market stabilization. Anat Admati and Martin Hellwig (
2018-05-02 06:32:00 Wednesday ET
What are the primary pros and cons of free trade or fair trade in the current Sino-American quagmire? Free trade means allowing goods and services to move a
2018-12-11 10:34:06 Tuesday ET
Several eminent American China-specialists champion the key notion of *strategic engagement* with the Xi administration. From the Hoover Institution at Stan