Bad policy waits for “good data” – UBS
10.07.2024, 09:50

Bad policy waits for “good data” – UBS

Federal Reserve (Fed) Jerome Powell told the Senate banking committee that cutting rates too early would be bad, but cutting rates too late would also be bad. China’s consumer price inflation inches back toward deflation and politics continues to create long-term noise, UBS macro strategist Paul Donovan Suggest.

Politics and Central Bank comments drive the market

“Perhaps Federal Reserve Chair Powell has opened an economics book (possibly ‘How the world really works—the economy’). Powell told the Senate banking committee that cutting rates too early would be bad, but cutting rates too late would also be bad. Unfortunately, the Fed Chair insisted that more ‘good data’ was required to induce a rate cut.”

“China’s consumer price inflation inched back toward deflation in spite of strong pork prices. The implication is that expectations of domestic policy support will continue. We hear from BoE Chief Economist Pill today. Chief economists’ remarks should always be heard with reverential attention, but with speculation about UK rate cuts Pill’s comments assume even more importance.”

“Politics continues to create noise. France’s caretaker government can do little to produce fiscal stability, and coalition negotiations are meandering. NATO’s summit puts US President Biden’s competence under international scrutiny. These issues are not market moving in the short term, but matter in the long term.”

 

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Politika sprečavanja pranja novca

Upozorenje o rizicima

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Politika poverenja

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