The Fed aim to minimize risk
The Fed’s 2% objective will be determined by the rate cut, as shelter prices, which drive inflation, are expected to fall this year. This will lower price pressures and make the fed funds rate adjusted for inflation more restrictive if left steady. The first rate cut is likely to be driven by adjusting the real…
Will the Fed hold off cutting rates?
The US Federal Reserve is expected to stop raising interest rates by end-March, with a majority of Reuters economists predicting a stop. The median probability of a recession within a year has dropped to 40%, its lowest since September 2022. The Fed will retain the federal funds rate at 5.25-5.50%, with around 80% foreseeing no…
The Fed’s minutes indicate slowing economy on US, but the market moving other way
On Thursday, Wall Street traded unevenly due to fears over China’s economic difficulties and the possibility of increased US interest rates. The 10-year Treasury yield rose to its highest level in ten months, breaking October’s high of 4.338%. The Fed’s July minutes indicate a gradual slowing of the US economy, while data reveal no such…
China’s Yuan are Struggling toward US Dollar
Chinese state banks sold dollars to prevent the offshore yuan from falling, as the U.S. currency strengthened 6% this year. EDL Capital, a $1 billion hedge fund, believes geopolitical concerns will starve China of foreign investment. China’s labor market is less competitive than Vietnam and India, and post-pandemic recovery has stalled. EDL’s hedge fund, managed…
US Consumer are spending more than expected
The US economy experienced a near-recession in the third quarter of last year, but unexpected growth has been observed, reaching 3.2% and higher. The Atlanta Fed GDP nowcast estimates July-September output growth at 5.8%, indicating strong consumption and an unexpected rebound in industrial production and housing starts. Consumers have been spending more than projected, and…
An Impact of US recession
A year ago, the US was in a recession, but recent data has shown a soft landing where growth falls below the trend in 2024 but remains positive. The Federal Reserve’s interest rate hikes, falling housing investment, and other factors have led to a slowdown in economic momentum. The unemployment rate of 3.5% in July…
China’s central bank cutting it interest to stimulate the economy
China’s economy is nearing a crisis due to missed activity data since the second quarter. Growth concerns arose during the 2008-09 global financial crisis and the 2015 capital outflow fear. China’s debt-fueled investment in infrastructure and property has peaked, and household consumption is its only remaining demand source. China’s recovery depends on whether households spend…
Crude production reached its highest since 2020
The Energy Information Administration reported that US crude oil stockpiles declined last week due to increased run rates and increased exports. Refinery crude runs climbed to 16.75 million barrels, the most since January 2020, and refinery utilization rose to 94.7% of capacity. A weekly increase in US oil exports also depleted stocks, with net imports…