Warning: Illegal string offset 'page_specific_metadata' in /home/livesqua/public_html/classes/metadata.php on line 120
Livesquawk - Closing Wrap - Tuesday 27.04
Closing Wrap - Tuesday 27.04
Headlines
  • OPEC+ Sticks To Plan To Ease Oil Output Cuts From May 1
  • Biden Raising Minimum Wage For Federal Contractors To $15/Hr
  • Biden To Beef Up IRS To Claim Up To $700 Bln In Tax From Richest Americans
  • Ursula Von Der Leyen Says EU Could Punish UK Over Brexit Breaches
  • US Missile Defense Warhead Program To Cost Almost $18 Bln
  • Tesla To Tweak Application For German Gigafactory, Ministry Says
Commentary
Fed Set To Repeat Dovish Stance Despite Improved Outlook

Few changes if any are expected this week from the US Federal Reserve as America’s central bankers seem willing to further monitor the development of the world’s largest economy before considering alterations to monetary policy. Economists widely anticipate the Federal Open Market Committee to hold the benchmark interest rate in the current range of 0% - 0.25% and monthly asset purchases at USD 120bn.

 

In a message that largely echoed the comments of other institutions, Barclays said the results of this meeting and Chairman Jerome Powell’s comments after the announcement could feel like déjà vu. “We look for the Fed to stick to its message of patience before any moves to normalise its policy stance. We expect minimal changes in the statement, mainly to reflect solid incoming data on spending and employment, as well as the firming in inflation.”

 

The US Labor Department said non-farm payrolls in March surged by 916,000 – a seven-month high – which pushed the jobless rate down to 6%. Headline consumer price growth jumped to 2.6% last month. (LiveSquawk - Continue Reading)

Gundlach Says Fed Is Guessing That Inflation Will Be Transitory

It is not clear that U.S. inflation will be “transitory” as the Federal Reserve economists are trying to convey, according to Jeffrey Gundlach.

 

“I’m not sure why they think they know that it’s transitory,“ Gundlach of DoubleLine Capital LP said in an interview with BNN Bloomberg Tuesday. “How do they know that when there’s plenty of money printing that’s been going on and we’ve seen commodity prices going up really massively.”

 

While the Fed does have a point in saying the year-over-year increase -- which Gundlach says could be as high as 4% -- is higher in part because of the low, pandemic-induced numbers from 2020, the central bank may also be underestimating the impact of its wide-open monetary policies.

 

“There’s plenty of indicators that suggest that inflation is going to go higher, and not just on a transitory basis, for a couple of months. So we’ll see how the Fed is trying to paint the picture, but they’re guessing.“ (Bloomberg - Continue Reading)

Jerome Powell Is A Heavy Favourite On Wall Street To Be Renominated As Fed Chair

Federal Reserve Chairman Jerome Powell is a heavy favorite on Wall Street to be re-nominated for a second term by President Joe Biden even while there are substantial disagreements with the some aspects of Fed policy under Powell.

 

The CNBC Fed Survey for April finds 76% of respondents believe President Biden will choose Powell again. Nominated to be chair first by President Donald Trump, Powell began his first four-year term in 2018. It ends in early 2022 and presidents have typically unveiled their choices in the summer or fall before the chair’s term expires.

 

Eighteen percent of the 34 respondents, who include fund managers strategists and economists, believe Biden will choose someone other than Powell. Leading candidates mentioned including Fed Governor Lael Brainard and White House economic advisor Jared Bernstein. (CNBC - Continue Reading)

Files & Links
LIVESQUAWK PREVIEWS/REPORTS
DATA
GOVERNMENT/CENTRAL BANK NEWS
FIXED INCOME NEWS
FX NEWS
ENERGY/COMMODITY NEWS
EQUITY NEWS
EMERGING MARKET NEWS