This is a segment from a forwarding information ballot. To read full publications, subscribe.
In the world of FOMC Roadshow macro, world markets and experts are directly focused on Trump’s trade policy and their impact on the world economy.
This creates a state of fragility with a bunch of cross points. Economic activity stops, as enterprises are experiencing problems with decision -making and capital investments, not knowing what the prospects for tariffs will be.
After a certain initial tariff in January and February, the Federal Service forces FRS production index came to a long minimum:
Traditionally – since economic activity slows down – you will see a decrease in prices for economic balance. However, thanks to the impending concern of tariffs, we are observing a constant increase in prices paid for goods (as measured in the FRS report):
So this is growth (economic activity), and prices have risen. This is an unpleasant combination for central bankers.
What makes the picture even more erratic, contradicts this on the other side of the Federal Reserve of the FRS – the labor market. The initial unemployed claims (the date of labor market with the highest frequency) continues not to signal the significant dismissals taking place in the economy right now:
To be fair, the labor market is quite bad for those who are looking for a new job; But while you are sitting in your current work, now there is no significant cycle of dismissal. If the labor market is still in order, as it appears in current data, there is no significant catalyst on the other side of the Fed’s mandate that the Fed reacts to.
We have a current structure with lower growth, worthy of the labor market and higher prices (even if they are short -lived, a one -time increase in prices compared to tariffs, and not reflective embedding inflation). This structure forces the Fed to continue to sit in the arms.
Fed’s chairman Jerome Powell went to the podium yesterday and hit even more on this exchange of messages – to the horror of the bulls who strive to get the wind in the sails of their struggling bags. Excerpt from his speech:
