-
Policy
Policy
Exclusive interviews with leading policymakers that convey the true policy message that impacts markets.
LATEST FROM POLICY: -
EM Policy
EM Policy
Exclusive interviews with leading policymakers that convey the true policy message that impacts markets.
LATEST FROM EM POLICY: -
G10 Markets
G10 Markets
Real-time insight on key fixed income and fx markets.
Launch MNI PodcastsFixed IncomeFI Markets AnalysisCentral Bank PreviewsFI PiFixed Income Technical AnalysisUS$ Credit Supply PipelineGilt Week AheadGlobal IssuanceEurozoneUKUSDeep DiveGlobal Issuance CalendarsEZ/UK Bond Auction CalendarEZ/UK T-bill Auction CalendarUS Treasury Auction CalendarPolitical RiskMNI Political Risk AnalysisMNI Political Risk - US Daily BriefMNI Political Risk - The week AheadElection Previews -
Emerging Markets
Emerging Markets
Real-time insight of emerging markets in CEMEA, Asia and LatAm region
-
Commodities
-
Credit
Credit
Real time insight of credit markets
-
Data
-
Global Macro
Global Macro
Actionable insight on monetary policy, balance sheet and inflation with focus on global issuance. Analysis on key political risk impacting the global markets.
Global MacroDM Central Bank PreviewsDM Central Bank ReviewsEM Central Bank PreviewsEM Central Bank ReviewsBalance Sheet AnalysisData AnalysisEurozone DataUK DataUS DataAPAC DataInflation InsightEmployment InsightGlobal IssuanceEurozoneUKUSDeep DiveGlobal Issuance Calendars EZ/UK Bond Auction Calendar EZ/UK T-bill Auction Calendar US Treasury Auction Calendar Global Macro Weekly -
About Us
To read the full story
Sign up now for free trial access to this content.
Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Real-time Actionable Insight
Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.
Free AccessMNI INTERVIEW: FOMC Won’t Agree On Cuts Until December-Pingle
The Federal Reserve is too divided about whether to begin cutting interest rates for now, and policymakers are unlikely to coalesce around such a decision until December, former Fed board economist Jonathan Pingle told MNI.
Given mounting signs of economic softness, Pingle was surprised by the distribution of FOMC members’ forecasts for when they see the first rate cut in this week’s Summary of Economic Projections – in particular, that 11 of 19 are willing to wait until December or beyond.
“They seem to be facing no sense of urgency to cut. I don't know what is going to provide them with any urgency in time to put September back on the table for a lot of these participants,” said Pingle, now chief U.S. economist at UBS.
The median Fed dot pointed to just one rate cut for the year, a view that Pingle says he has embraced. “We pushed our first cut call from September to December yesterday after the dot plot and the press conference,” he said in an interview.
Just eight officials saw two cuts this year, which he views as the minority who favors a September move.
“I’m going to guess four were probably regional Fed presidents, maybe five. So it looks like there’s even a split amongst the board about simply until December,” he said. “Chair Powell seems very comfortable with the current stance of policy.”
Pingle said a November cut is likely off the table because “it’s just going to be extremely difficult to communicate the first cut of dialing back restrictiveness if the quiet period includes a presidential election,” he said.
“So I really looked at the dot plot as people trying to decide whether or not to keep September on the table, or just wait until December or next year. And it looks like a reasonable majority think that it’s okay waiting.” (See MNI INTERVIEW: Fed Might Not Cut Rates In 2024-Andolfatto)
ADVANCE SIGNALS
Pingle said Powell tends to like to communicate his decision well in advance and for now, he did not appear to be laying the groundwork for a September cut.
“Chair Powell did not sound like a Fed chair who is going to cut two meetings later. And he’s also been a chair who’s generally liked to communicate the committee’s thinking in advance,” Pingle said.
“Is he going to communicate September is the time in the July press conference? I struggle with it. You will have Jackson Hole but there’s actually not that much information between now and then.
INFLATION RETICENCE
Powell told reporters during his press conference the Fed SEP’s shift to a median of one cut for 2024 reflected in part policymakers’ upward revision of their year-end inflation projection, to 2.8% from 2.6% on core PCE.
While Powell said those estimates reflect an element of conservatism regarding the possibility of upside surprises, Pingle believes inflation will catch officials off guard by falling more quickly than they expect.
Still, Powell did not seem phased by the signs of cracks in the economy and the job market that Pingle sees, describing both as robust.
“Our inflation forecast says they should already be cutting already. We think they’re falling behind the curve,” he said.
“If they’re not worried a little bit more about the strength of the expansion, 2.5% core inflation isn’t going to scare somebody. Barring labor market weakness it just seems like the people that keep pushing out the timing are comfortable with it and winning the debate.”
To read the full story
Sign up now for free trial access to this content.
Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.