MMA FREE WEEKLY COLUMN FOR THE WEEK BEGINNING SEPTEMBER 2, 2024 ©
August 30, 2024
Note: Financial markets will be closed on Monday in the U.S. due to the Labor Day holiday.
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The Commerce Department reported Friday that the personal consumption expenditures price index rose 0.2% on the month and was up 2.5% from the same period a year ago, exactly in line with the Dow Jones consensus estimates…. In recent days, policymakers such as Chair Jerome Powell have expressed confidence that inflation is progressing back to the Fed’s 2% goal. The Fed is expected now to switch from a nearly complete focus on bringing down inflation to at least an equal concentration on supporting the labor market.
—Jeff Cox, “The Fed’s Favorite Inflation Indicator Increased 0.2% in July, As Expected,” August 30, 2024, www.cnbc.com.
MMA FREE WEEKLY COLUMN FOR THE WEEK BEGINNING AUGUST 26, 2024 ©
August 23, 2024
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Federal Reserve Chair Jerome Powell laid the groundwork Friday for interest rate cuts ahead, though he declined to provide exact indications on timing or extent. “The time has come for policy to adjust,” the central bank leader said.
—Jeff Cox, “Fed Chair Powell Indicates Interest Rate Cuts Ahead,” August 23, 2024, www.cnbc.com.
MMA FREE WEEKLY COLUMN FOR THE WEEK BEGINNING AUGUST 19, 2024 ©
August 16, 2024
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Inflation extended a run of cooler readings in July, sealing the case for the Federal Reserve to cut interest rates at its meeting next month. The consumer-price index rose 2.9% from a year earlier, the Labor Department said Wednesday, the lowest reading since 2021 and slightly below economists’ expectations of 3%. Core inflation, which excludes volatile food and energy items, was 3.2%, also a three-year low.
—Sam Goldfarb and Nick Timiraos, “Cooling July Inflation Sets Stage for Fed’s September Rate Cut,” Wall Street Journal, August 14, 2024.
MMA FREE WEEKLY COLUMN FOR THE WEEK BEGINNING AUGUST 12, 2024 ©
August 09, 2024
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Mortgage buyer Freddie Mac said Thursday that the average rate on a 30-year loan tumbled to 6.47%, the lowest level in more than a year. While that is down from a peak of 7.79% in the fall, it remains sharply higher than the pandemic-era lows of just 3%.
—Megan Henney, “Home Prices Are Finally Starting to Fall,” www.foxbusiness.com, August 9, 2024.
MMA FREE WEEKLY COLUMN FOR THE WEEK BEGINNING AUGUST 5, 2024 ©
August 02, 2024
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U.S. job growth cooled sharply in July while the unemployment rate unexpectedly rose to the highest level in nearly three years. The Labor Department reported Friday that employers added 114,000 jobs in July, missing the 175,000 gain forecast by LSEG economists. The unemployment rate also unexpectedly inched higher to 4.3% against expectations that it would hold steady at 4.1%. It marked the highest level for the jobless rate since October 2021.
—Megan Henney, “US Job Growth Slows to 114K in July While Unemployment Unexpectedly Jumps,” www.foxbusiness.com, August 2, 2024.
MMA FREE WEEKLY COLUMN FOR THE WEEK BEGINNING JULY 29, 2024 ©
July 26, 2024
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The Commerce Department said Friday its personal consumption expenditures inflation gauge rose 2.5% in June compared to a year earlier, slowing from its 2.6% pace in May….On the CME‘s FedWatch tool, which uses fed funds data to estimate the pricing of rate moves, odds of rates remaining unchanged next week are 93%, while odds of a 25-basis point cut in September are 90%. Meanwhile, some pundits have called for a cut already next week, in order to avoid an undesired overcooling of the economy.
—Paulo Trevisani, “U.S. Inflation Data Keeps Door Open for September Interest Rate Cut,” Wall Street Journal, July 26, 2024.
MMA FREE WEEKLY COLUMN FOR THE WEEK BEGINNING JULY 22, 2024 ©
July 19, 2024
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Financial services and doctors’ offices were disrupted on Friday, while TV broadcasters went offline as businesses worldwide grappled with an ongoing major IT outage. Air travel has been particularly hit, with planes grounded, services delayed and airports issuing advice to passengers…. cybersecurity giant CrowdStrike experienced a major disruption, following an issue with its latest tech update.
—Ruxandra Iordache, “‘Largest IT Outage in History’ Leaves World Reeling,” www.cnbc.com, July 19, 2024.
MMA FREE WEEKLY COLUMN FOR THE WEEK BEGINNING JULY 15, 2024 ©
July 12, 2024
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Why wait until September?… The Fed’s publicly stated criteria for a rate cut, that it can be confident inflation is moving down toward its 2% target, appear to have been met. The core consumer-price index, stripping out food and energy, rose just 3.3% in June from a year earlier—the slowest pace in over three years. This year-over-year core CPI rate has either slowed or stayed the same for 16 straight months, making the market’s freakout over a supposed inflation rebound earlier this year look decidedly overblown.
—Aaron Back, “It’s Time for the Fed to End the Waiting Game,” Wall Street Journal, July 12, 2024.
MMA FREE WEEKLY COLUMN FOR THE WEEK BEGINNING JULY 8, 2024 ©
July 05, 2024
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The Labor Department reported on Friday that the U.S. added a solid 206,000 jobs last month, slightly beating expectations and continuing a remarkably strong run. But the unemployment rate ticked up to 4.1%, a sign of slack in a labor market that has already shown some hints of gradually slowing down…. Average hourly earnings were up 3.9% in June from a year earlier, marking their smallest gain since 2021. The counts for both April and May were revised lower by a combined 111,000 jobs.
-Justin Lahart and Nick Timiraos, “Case for September Rate Cut Builds After Slower Jobs Data,” wsj.com, July 5, 2024.
MMA FREE WEEKLY COLUMN FOR THE WEEK BEGINNING JULY 1, 2024 ©
June 28, 2024
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Note: Next week will be a shortened trading week due to the observance of the July 4 Independence Day in the U.S.
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It was in fact as consequential as any presidential debate in history, and the worst night for an incumbent in history. It was a total and unmitigated disaster for Mr. Biden. It was a rout for Mr. Trump…. It is impossible to believe that the Democrats will continue with Mr. Biden as their presidential standard-bearer.
— Peggy Noonan, “The Most Important Presidential Debate Ever: It Was an Unmitigated Disaster for Biden and a Rout for Trump. Democrats Will Have to Face Reality,” Wall Street Journal, July 29, 2024.