3 min readA Spooky Beginning to October The U.S. government shutdown has now entered its third week, and on Tuesday, Speaker Johnson cautioned that it could become the longest shutdown in history. Adding to market uncertainty are renewed trade tensions after President Trump threatened an additional 100% tariff on Chinese imports in response to Beijing’s new export…
3 min readGovernment Shutdown: Economic & Market Implications A stalemate over health care subsidies has triggered the first government shutdown in nearly seven years, affecting an estimated 750,000 federal employees. Historically, shutdowns tend to be either brief (lasting just 2–3 days) or stretch for several weeks. From an economic and market perspective, the impact has generally been…
2 min readFOMC Reduces Fed Funds Target Range by 25 bps As expected, the Federal Reserve cut the fed funds target range by 25 bps on Wednesday, setting a new target range of 4.00%–4.25%. The decision was nearly unanimous, with only newly appointed Governor Miran dissenting in favor of a larger 50 bp cut. FOMC Statement …
3 min readAnother Disappointing Employment Report The August jobs report was broadly disappointing, marking the second consecutive month of weaker-than-expected results: The BLS preliminary benchmark revisions (covering April 2024–March 2025) suggested total payrolls were overstated by 911,000 jobs, further highlighting labor market softness. At the same time, weekly jobless claims climbed to 263,000, the highest since 2021….
3 min readPowell Cracks the Door Open to a September Cut At the Jackson Hole Symposium on August 22nd, Fed Chair Jerome Powell signaled that the first rate cut of 2025 could be on the table at the September FOMC meeting, noting that “the shifting balance of risks may warrant adjusting our policy stance.” His more dovish…
7 min readKey Takeaways: Tariffs Fade, But Risks Remain With trade war tensions easing, tariff uncertainty is beginning to fade. The U.S. economy has so far avoided recession, despite a slowdown in growth, while inflation remains close to the Federal Reserve’s 2% target. Stock markets are reaching new all-time highs and bond yields continue to decline, implying…
4 min readFed Déjà Vu This August is starting to feel like déjà vu. In July 2024, a weak employment report was followed just weeks later by Fed Chair Powell’s Jackson Hole remarks, where he signaled that “the time has come for policy to adjust.” At the very next FOMC meeting in September 2024, the Fed cut…
5 min readPowell Maintains a Hawkish Stance Amid FOMC Dissent Last week the FOMC, as expected, left the federal funds target range unchanged at 4.25%–4.50% for the fifth consecutive meeting. Notably, two Federal Reserve governors—Christopher Waller and Michelle Bowman—dissented, each favoring a 25 basis point cut. While regional Federal Reserve Bank Presidents have dissented more frequently, this…
3 min readThe Labor Market is Holding Up For the fourth consecutive month, nonfarm payrolls exceeded expectations with June adding 147,000 jobs versus the projected 106,000. The trend of job growth remains solid and strong with average gains of 150,000 over the past 3 months, 130,000 over the past 6 months, and 151,000 over the past year….
4 min readStagflation Headlines Close Out Q2 Economic data released at the end of June showed signs of stagflation, which is likely prompting the Fed to maintain its current policy stance in the near term: Looking ahead, GDP growth is projected to rebound in the second quarter, with estimates currently at +2.1%. However, inflationary pressures tied to…