Daily Economic Update: September 21, 2023

If you missed the FOMC yesterday, see here.  Post FOMC yields are back to cycle highs and stocks continue to be under pressure.  The 10Y is up 9bps to 4.43% and the 2Y is at 5.15% (touched 5.20%).  It has been surprising how well equities and credit markets have largely held up despite all of the hikes.  We get the BoE at 7am where it is thought to be a split on hold or hike.  We've already had the Swiss National bank hold rates this morning while the Swedish and Nowegian central banks announced hikes. A slew of data stateside including jobless claims, Philly Fed, Existing home sales and leading indicators.  Still have UAW, China issues, the growing rift between Canada and India, etc.

XTOD: Every member of the FOMC thinks that at least some of the recent favorable inflation news was transitorily transitory.  Specifically, hitting their forecasts for core PCE inflation in 2023 (which range from 3.5% to 4.2%) would require a step-up in inflation over the next months.

XTOD: H4L island is rocking!

XTOD: Same institution that brought us “no tech bubble” in 2000, “subprime contained” in 2007, “green shoots” in 2009, “funds rate through neutral” in 2018, “transitory” in 2021, is now peddling “higher for longer” in 2023.  Fade the Fed.

XTOD: Goldman Sachs Changes Forecast For Fed's First Rate Cut To Q4 2024 From Q2 2024 Expected Previously

XTOD: Retired boomers being given a golden opportunity to take risk off, 2% real rates across the tips curve...buy the ladder, and ignore the market for the next 30 years

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