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.
2016-10-19 00:00:00 Wednesday ET
India's equivalent to Warren Buffett in America, Rakesh Jhunjhunwala, offers several key lessons for stock market investors: When the press o
2018-12-05 09:38:00 Wednesday ET
Federal Reserve publishes its inaugural flagship financial stability report. Fed Chair Jerome Powell applauds both low inflation (2%) and low unemployment (
2019-02-05 10:32:00 Tuesday ET
President Trump remains optimistic about the Sino-American trade war resolution of both trade deficit eradication and tech transfer enforcement. Trump now s
2019-01-21 10:37:00 Monday ET
Andy Yeh Alpha (AYA) AYA Analytica financial health memo (FHM) podcast channel on YouTube January 2019 In this podcast, we discuss several topical issues
2019-03-03 10:39:00 Sunday ET
Tech companies seek to serve as quasi-financial intermediaries. Retail traders can list items for sale on eBay and then acquire these items economically on
2018-02-03 07:42:00 Saturday ET
Quant Quake 2.0 shakes investor confidence with rampant stock market fears and doubts during the recent Fed Chair transition from Janet Yellen to Jerome Pow