“Growth isn't fast enough that the Fed has to brake the economy, and at the same time it isn't slow enough that the Fed can stop and watch. Inflation pressures can still gain a foothold as the economy continues to take up slack resources.”
Chris Rupkey
“If the Fed is on the warpath with an eye to slowing the economy and trying to blunt inflation before it becomes a problem, by slowing the economy the Fed is hoping to address any imbalances between supply and demand, specifically for labor. It feels to me like the market is starting to look beyond the impact of the Fed and setting ourselves up for a second half where the wrestling match will not be between interest rates and valuations but rather between earnings and valuations.”
Charles Crane
“Fundamentally, the economy has not slowed as investors had hoped or the Fed requires. It puts a tightening in August back on the table.”
Charles Lieberman
“Chairman Greenspan's comments went further than previous Fed commentary on recognizing the degree of slowing in the economy and clearly pave the way for the Fed to switch to a neutral directive. Moreover, his comments further encourage us in our belief that the Fed will lower rates in the first quarter of next year.”
Wayne Angell
“There's no sign of the economy slowing down and Fed officials should continue to be hawkish. It's a misconception that long-term yields will fall further.”
Yasutoshi Nagai
“This economy has a lot of momentum and seems intent on challenging the Fed to keep in under control. Inflation is a real risk here after six years of expansion. The Fed perhaps is taking the first step, a down payment if you will, to try and keep that under control. But it may take more than what we saw yesterday.”
Carl Tannenbaum
“Friday's solid US payrolls headlines and strength in average earnings growth have boosted Fed tightening expectations further.”
Daniel Katzive
