The Federal Reserve’s current easing cycle began exactly a year ago. One year later, there is a zero interest rate policy with a revamped quantitative easing policy to ward off another potential financial crisis. Kevin Flanagan explains why, against this backdrop, it should come as no surprise the Fed decided to take a bit of a summer vacation at this July FOMC gathering.
After the end of 2019, the U.S. economy went straight into negative territory, as the pandemic-related shutdowns produced unprecedented contractions in activity. Most market participants have been of the mindset that the economy would not return to pre-pandemic levels until the end of 2021. However, after analyzing the latest real GDP forecasts, Kevin Flanagan discusses whether the economy can recover sooner than expected.
The Federal Reserve released its new policy framework late last month in connection with Chair Powell’s Jackson Hole speech, so it’s not surprising that the September FOMC meeting did not provide any fresh headlines. There is one key question following today’s Fed meeting that Kevin Flanagan seeks to answer: how will the Fed implement this new approach?
The headlines surrounding the August Employment Situation report seemed to focus on the moderating pace of new hiring activity. Kevin Flanagan explains why he believes the more notable story was the sizable drop in the unemployment rate and the impact on the fixed income market.
At last week’s Jackson Hole conference Chairman Powell announced a noteworthy shift in how monetary policy is now going to be delivered. Kevin Flanagan explains the Fed’s decision to let the economy ‘run hot, hot, hot’ to achieve their average inflation goal over time.
Tomorrow morning Chairman Powell is scheduled to take center stage at the annual Jackson Hole conference. The focus will be on what, if any, adjustments can be expected with respect to inflation targets and the Fed’s balance sheet. Kevin Flanagan discusses the possible outcomes.
As we continue to be bombarded with headlines and news stories on a 24-7 basis, sometimes it is difficult to know what to focus on in terms of economic numbers. Kevin Flanagan explains which reports investors should look to as economic indicators in the current investment landscape.