Forward guidance is not good at this juncture On rate path, we don’t know how the economy will play out Hard to say the labor market has firmed This comments strike me as disingenuous.
The jobs market has certainly firmed in the last 3-4 months and the data has consistently pointed in that direction
At the same time, inflation has obviously increased as well. I think there’s an increasingly-good trade in terms of risk-reward on the Fed falling behind the curve on inflation. There is a powerful mix of AI capex, fiscal spending, oil prices, low immigration and tariffs that are a recipe for persistent inflation above 2% and at some point the Fed will have to address it.
Rates at current levels aren’t getting the job done. am Button