2019-02-04 07:42:00 Mon 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
Federal Reserve remains patient on future interest rate adjustments due to global headwinds and impasses over American trade and fiscal budget negotiations. Fed Chair Jerome Powell pledges that future interest rate adjustments react to generic macroeconomic conditions.
Patience can be a key virtue. U.S. economic history suggests that the federal funds rate tends to peak in the reasonable range of 5.5%-6.5%. In comparison, several eminent economists such as former Fed Chairs Janet Yellen and Ben Bernanke suggest that we may enter a new era of persistently low interest rates. This putative scenario can be good news for debtors such as American households and federal government, the latter of which now carries about $16 trillion public debt. The same putative scenario may become bad news for most U.S. retirees who live off meager interest income on their deposits and annuities. This low-interest-rate environment can inadvertently continue to inflate asset prices. As a result, U.S. stocks soar in response to the dovish monetary policy stance with balance sheet flexibility. As the Federal Reserve keeps the key interest rate in the target range of 2.25%-2.5%, the trade-weighted average U.S. dollar index plummets to 91%. The recent greenback depreciation reflects a major reversal of U.S. credit flows in comparison to the 95% dollar peak back in January 2017.
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.
2019-06-13 10:26:00 Thursday ET
The Chinese Xi administration may choose to leverage its state dominance of rare-earth elements to better balance the current Sino-U.S. trade war. In recent
2017-11-24 08:41:00 Friday ET
Is Bitcoin a legitimate (crypto)currency or a new bubble waiting to implode? As its prices skyrocket, bankers, pundits, and investors increasingly take side
2023-12-07 07:22:00 Thursday ET
Economic policy incrementalism for better fiscal and monetary policy coordination Traditionally, fiscal and monetary policies were made incrementally. In
2019-05-02 13:30:00 Thursday ET
Netflix has an unsustainable business model in the meantime. Netflix maintains a small premium membership fee of $9-$14 per month for its unique collection
2019-11-15 13:34:00 Friday ET
The Economist offers a special report that the new normal state of economic affairs shines fresh light on the division of labor between central banks and go
2019-06-11 12:33:00 Tuesday ET
Dallas Federal Reserve Bank President Robert Kaplan expects the U.S. economy to grow at 2.2%-2.5% in 2019-2020 as inflation rises a bit. In an interview wit