The Federal Reserve forecasts only a modest uptick in U.S. unemployment next year as inflation cools, but history and current labor market trends make us less certain.
Amid an outlook for slower growth and more moderate inflation, the Fed shifts to data dependence.
After stubborn U.S. inflation in the first half of 2023 kept the Federal Reserve raising rates, June’s softer inflation report suggests July may mark the end of the hiking cycle.
The Federal Reserve paused in June but raised its estimates for the policy rate later this year. We expect a July increase but remain skeptical about subsequent hikes.
March inflation data may put the Federal Reserve close to its terminal policy rate this cycle, if it hasn’t already reached it.
History suggests the lagged economic effects of tighter central bank policy are arriving on schedule, but any eventual normalizing or even easing of policy will still likely require inflation to decline further.
Slower credit growth may curtail broader U.S. economic growth, taking pressure off the Federal Reserve.
The failure of Silicon Valley Bank raises questions for Fed policy and economic growth.
Strength in employment and inflation has caused markets to raise the implied terminal rate while still expecting the Fed to normalize policy – which is different from easing – in 2024.
U.S. inflation may not be moderating as quickly as many were expecting.
Investors face mixed signals between the Federal Reserve’s policy guidance and recent economic developments.
After enduring one of the worst years on record across asset classes, investors should find more cause for optimism in 2023, even as the global economy faces challenges.
Falling prices for cars and holiday discounting contributed to softer U.S. inflation, creating more room for the Fed to potentially dial back its hawkish stance.
Core inflation came in below expectations for October and should moderate in 2023, but likely with bumps in the road ahead.
The Federal Reserve’s November statement included dovish language, but Fed Chair Powell warned investors not to expect the Fed to stray from its full focus on fighting inflation.
Core inflation in the U.S. outpaced expectations for September and may fortify the Federal Reserve’s hawkish resolve.
This is a critical time for investors and policymakers alike.
The Federal Reserve released new economic projections suggesting interest rate hikes will be faster and larger than previously forecast.
The Federal Reserve may be pressured to target a higher terminal fed funds rate as it seeks to tame U.S. inflation expectations following strong price rises in August.
In Jackson Hole, Federal Reserve officials unequivocally emphasized their commitment to bringing inflation under control – even as the U.S. economy slows.
Despite price declines in many sectors, the Federal Reserve may continue its hawkish approach.
The Federal Reserve affirmed its commitment to price stability, hiking its policy rate 75 basis points again and signaling more tightening to come.
June’s U.S. CPI (Consumer Price Index) inflation data likely set alarms blaring in the minds of Federal Reserve officials.
June’s U.S. inflation data will likely force central bankers into more restrictive territory – raising the odds of recession.
The January U.S. CPI (Consumer Price Index) report indicated a higher pace of inflation than many observers expected.
Much of the global economy has transitioned quickly from an early-cycle recovery to a mid-cycle expansion that now appears to be rapidly progressing toward late-cycle dynamics.
At the January 2022 meeting, the U.S. Federal Reserve signaled an accelerated timetable to normalize policy, but it will be a long process amid an uncertain environment.
The strong inflation report combined with employment data will likely prompt the U.S. Federal Reserve to begin hiking its policy rate in March.
Uncertainty has become an ongoing theme in markets, economies, and communities everywhere, and in this environment, PIMCO investment professionals gathered – virtually, once again – for our recent Cyclical Forum.
The Federal Reserve pulls forward rate hike expectations and doubles the pace of tapering in an effort to provide more flexibility to react in 2022.
The risks of continued elevated inflation likely have the U.S. Federal Reserve considering material changes to its policy path.
Stronger-than-expected U.S. inflation data in October may prompt the Federal Reserve to consider tapering faster and hiking sooner.
The Federal Reserve navigated its tapering announcement without much market volatility, but faces the challenge of managing rate expectations amid elevated inflation risks.
Elevated risks to inflation expectations appear to have prompted Federal Reserve officials to revise their policy rate hike projections higher.
The Fed stopped short of providing “advance notice,” but a December tapering announcement remains likely.
Over the past few months, economic recoveries have been uneven across regions and sectors.
We believe the U.S. is undergoing a large price-level adjustment, not shifting to a persistently higher inflation regime.
As regulators push to transition away from Libor, sales of Treasuries linked to the successor rate could boost the new benchmark’s credibility and expand nascent markets for related debt and derivatives.
As expected, the Federal Open Market Committee (FOMC) announced no changes to its administered rates following its April meeting, and Federal Reserve Chair Jerome Powell did not provide new information about the Fed’s bond-buying programs.
On April 21 the Governing Council of the Bank of Canada (BoC) will meet to discuss monetary policy.
The Federal Reserve on 19 March announced that the temporary changes to its supplemental leverage ratio, or SLR, will expire as scheduled on 31 March.
Following its March meeting, the Federal Open Market Committee (FOMC) released a statement and summary of economic projections (SEP).
As the latest COVID-19 relief bill winds through the U.S. Congress, some economists have been warning that too much stimulus could lead to the economy overheating
One year since the inception of one of the most severe recessions in modern history, women’s engagement in the labor force is crucial to the economic recovery.
A large fiscal package geared toward pandemic relief will likely boost U.S. growth even further in 2021, but long-term inflationary risks are still balanced.
A clear communication strategy is crucial to managing market expectations around changes in Federal Reserve asset purchases and interest rate policy.
With a narrowly Democratic Congress, U.S. fiscal spending is likely to increase on economic relief from the pandemic, infrastructure, and healthcare, boosting the economic rebound.
Rising prices in July have led PIMCO to raise its core inflation forecast for 2020, but not 2021.