Discover and read the best of Twitter Threads about #monetarypolicy
Most recents (24)
As was widely expected, the @federalreserve today halted the most aggressive policy rate #HikingCycle since 1980, leaving the Fed Funds range unchanged at 5.0% to 5.25%, a level that appears clear to us to be finally having an impact on the #economy.
We think today’s actions represent a “Hawkish skip,” which implies that #policy makers are seeking more #data before potentially hiking rates again in July, or September.
For our part, we think #ChairPowell’s comments at the press conference made it clear that the #FOMC is seeking to balance increasingly restrictive monetary policy with the high degree of uncertainty around the tightening of #CreditConditions…
What is the relationship between interest rates, financial stability, and the macroeconomy? In a three post series with
@ozgeakinci @BenignoGianluca Ethan Nourbash and @Albert_Queralto we look into this arguably timely question #interestrates #monetarypolicy #financialstability
@ozgeakinci @BenignoGianluca Ethan Nourbash and @Albert_Queralto we look into this arguably timely question #interestrates #monetarypolicy #financialstability
In the first post Financial Vulnerability and Macroeconomic Fragility we argue that the effects of an increase in interest rates on the macroeconomy depends on how vulnerable the financial system is libertystreeteconomics.newyorkfed.org/2023/05/financ… 2/n
We also propose a new measure of financial system vulnerability, the Financial (In)Stability Real Interest Rate, r**, based precisely on the question: How large an interest rate increase can the financial system take before entering a crisis?
newyorkfed.org/medialibrary/m… 3/n
newyorkfed.org/medialibrary/m… 3/n
Today’s #JobsReport was very solid, but like is often the case in the movies, it’s very hard for the sequel (today’s report) to match such an unexpected hit (January’s revised 504,000 jobs gained).
Still, a nonfarm #payroll gain of 311,000 jobs is quite good and having 815,000 jobs created so far this year after the #economy has already created 12 million #jobs over the past two years is pretty amazing in its own right.
Further, the 3-month moving average of 351,000 jobs, after a 12-month moving average of 362,000 jobs gained per month is also pretty remarkable, particularly after the market-implied pricing of the terminal #FedFunds rate has move up 500 basis points (bps) in a year.
A confluence of unprecedented events in 2022 weakened asset prices across all markets. (1/n)
#assetallocation #investing #personalfinance #throwback #thread
#assetallocation #investing #personalfinance #throwback #thread
The Fed’s pivot to a less aggressive monetary policy is likely to set the tone for the markets in 2023. (2/n)
#FED #FederalReserve #monetarypolicy
#FED #FederalReserve #monetarypolicy
It is expected that global inflation will continue to be higher in this decade, in combination with a significant slowdown of the U.S. economy. (3/n)
#inflation #interestrates #globalmarket
#inflation #interestrates #globalmarket
As we kickoff 23', here's a thread w/ the latest data 🏦💵🖨 on #StockMarket liquidity, credit, & financial conditions within the broader markets... 🧵/👇🏼
📊 h/t @crossbordercap
#FederalReserve #interestrates #stockmarket #Crypto #GDP $DXY $TLT $SPY $ES $SPX $QQQ $DIA $IWM
📊 h/t @crossbordercap
#FederalReserve #interestrates #stockmarket #Crypto #GDP $DXY $TLT $SPY $ES $SPX $QQQ $DIA $IWM
1/🧵 One of the indicators we watch is the @federalreserve 'Net Liquidity' as this tracks the markets very closely....
📊 h/t @fkronawitter1
#FederalReserve #interestrates #stockmarket #Crypto #GDP $DXY $TLT $SPY $ES $SPX $QQQ $DIA $IWM
📊 h/t @fkronawitter1
#FederalReserve #interestrates #stockmarket #Crypto #GDP $DXY $TLT $SPY $ES $SPX $QQQ $DIA $IWM
2/🧵 In addition to this, investors also have to look past the @federalreserve as global Central Banks 🏦 have joined in QT against the #inflation backdrop...
📊 h/t @LanceRoberts @ISABELNET_SA @topdowncharts @insidefinance
📊 h/t @LanceRoberts @ISABELNET_SA @topdowncharts @insidefinance
Here's the #inflation story you're expected to believe (advance warning: this story is entirely false): America gave the poors too much money during the lockdown and now the #economy is awash in #FreeMoney, which made those poors so rich that now they're refusing to work. 1/
If you'd like an essay-formatted version of this thread to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:
pluralistic.net/2022/12/14/med… 2/
pluralistic.net/2022/12/14/med… 2/
That means the economy isn't making anything anymore. With all that extra money and all those missing workers, prices are skyrocketing.
To hear ghouls like @LHSummers tell it, there is only one answer to this. 3/
To hear ghouls like @LHSummers tell it, there is only one answer to this. 3/
DISCLAIMER : This is for educational purpose and not financial advise.
Monthly market analysis Sep 30, 2022
#StockMarket Worst week, worst month, and worst quarter of the year since Financial crisis and dot-com bubble. Why it happened?
Let's look at more closely 🧵👇
Monthly market analysis Sep 30, 2022
#StockMarket Worst week, worst month, and worst quarter of the year since Financial crisis and dot-com bubble. Why it happened?
Let's look at more closely 🧵👇
1. After making reversal at H/S neckline in early Aug, US 10Y Yield #bond broke out from Feb'11 high 3.73% and have held up strongly for about a week. This month, yield has gone up +20%, bad for risk and long duration assets
#StockMarket
#StockMarket
2. US 02Y Yield #bond broke out resistance 3.7% and past 4% strongly after Fed Reserve hawkish announcement and never look back. This month yield has gone up more than +22%
#StockMarket
#StockMarket
What really causes inflation? 🧵
[a thread for normies - like me]
[a thread for normies - like me]
2/ The problem with #inflation is that it's a very personal experience.
As I always say, the wallet is the most sensitive organ in the body, so my inflation might not be your inflation.
In fact, my inflation could be seen as #disinflation by you... (more on that later)
As I always say, the wallet is the most sensitive organ in the body, so my inflation might not be your inflation.
In fact, my inflation could be seen as #disinflation by you... (more on that later)
3/ Price inflation and monetary inflation have different definitions:
* For many.- #inflation is the increased prices paid for goods & services.
** To others.- it's a decline in the purchasing power of your #money.
*** In layman's terms.- Too much money chasing too few goods.
* For many.- #inflation is the increased prices paid for goods & services.
** To others.- it's a decline in the purchasing power of your #money.
*** In layman's terms.- Too much money chasing too few goods.
Welcome to the Most Anticipated Recession in History–Part 2 -It's a #GlobalRecession & #LiquidityCrisis. Consumer perspective shaped by what’s going on in their own world despite politicos ignoring the chaos - by @TraderStef for @crushthestreet #Recession
crushthestreet.com/articles/break…
crushthestreet.com/articles/break…
The global economy has changed dramatically this year, and financial markets have turned volatile. The question on everyone’s mind now is…
(1/8)
#globaleconomy #financialmarkets #nifty
(1/8)
#globaleconomy #financialmarkets #nifty
Will recession hit India? How will it be different from past recessions that our country has faced?
Let’s look at some data points.
(2/8)
#recession #india #economy
Let’s look at some data points.
(2/8)
#recession #india #economy
Based on the RBI’s assessment, the Real GDP projection is retained at 7.2% for FY23. This comes on the back of strong investment activity, improving bank credit and rising capacity expansion.
(3/8)
#rbi #gdp #centralbanks
(3/8)
#rbi #gdp #centralbanks
The headline #inflation data today moderated a bit on the back of falling #gasoline prices, but it’s still running at a worryingly high rate.
Over time, we think the slowdown in #economic growth, the continuation of the @federalreserve’s assertive #HikingCycle and the possibility of resolution with several persistent supply chain issues should influence broad #inflation lower.
Still, while #CorePCE inflation (the #Fed’s favored measure) is likely to moderate in the coming months, it’ll still remain well-above the Fed’s 2% #inflation target.
The #JobsReport came in at 372,000 jobs gained, the #unemployment rate at 3.6%, which was coupled with #wage growth of 5.1% year-over-year: all solid numbers in a historic context.
Still, when taken in the context of much of the #economic data coming in, last week’s #employment report reemphasized two key tenets of the economy and consequently of #investment markets: 1) the U.S., and indeed the global economy, is tangibly slowing…
…and 2) we are probably past the #employment peak and will likely witness #LaborMarket slowing in the back half of the year.
🧵1. There is no #coalition as the NDP MPs are not in the Liberal cabinet., instead there is a supply and confidence agreement to provide stability and an environment to get important work done #supplyandconfidenceagreement
2. During a time when transitions from a pandemic financing to normalcy must take place Canadians will benefit from what the supply and confidence agreement provides. Federal #COVID19supports expired on May 7th. cbc.ca/news/politics/…
3. Finance Minister Chrystia Freeland says Canada's surging job growth and record-low unemployment rate is evidence that ongoing pandemic support will not be needed. Those applying for workers' benefits have 60 days to submit their claims, while businesses have 180 days.
As was widely expected, the @federalreserve’s Federal Open Market Committee raised the target range for the Federal Funds #policy rate by 50 basis points (bps), to between 0.75% and 1.0%, and announced the start of #runoff of the central bank’s balance sheet.
As previously suggested by the #Fed’s March minutes, the pace of runoff was confirmed today as $95 billion/month ($60 billion in U.S. #Treasuries and $35 billion in Agency #MBS, with a three-month phase-in period.
Also as expected, the statement reiterated that the #FOMC “anticipates that ongoing increases in the target range will be appropriate,” underscoring the seriousness of #Fed policymakers in getting #inflation and inflation expectations under control.
While there is still considerable uncertainty over the forecast for #inflation, we think both Core #CPI and #PCE inflation peaked in March and February, respectively, and should move appreciably lower by the end of 2022.
Throughout the pandemic, strong disposable #income and limited services spending fueled consumer #spending on goods and high goods volumes created #bottlenecks and extreme #inflation.
Eventually, excessively easy #MonetaryPolicy caused this robust #inflation to broaden into less disrupted categories.
15 takeaways from .@APompliano’s discussion with .@RaoulGMI that will make an immediate impact
= THREAD 🧵 =
= THREAD 🧵 =
Pre-2017 was #Bitcoin’s first season. It went from completely unknown to the first steps of mainstream adoption.
2017 was the beginning of season 2, which was a continuation of season 1, just on steroids.
2020 was the beginning of season 3, which is where we’re still at…
2017 was the beginning of season 2, which was a continuation of season 1, just on steroids.
2020 was the beginning of season 3, which is where we’re still at…
FT opinion article: “Central bankers should think twice before pressing the brake even harder - The war against Ukraine has brought a new negative supply shock on top of the old one”. Harder? Thread #bonds #equities #centralbanks #monetarypolicy ft.com/content/41c248…
1/According to the author the invasion of Ukraine has silenced the debate about “transitory” inflation. But where central banks stood impacts how they react. Initially the idea was that inflation was the result of supply issues that could be ignored. This view lost out.
2/Central banks made hawkish turns and have painted themselves into a corner, as the Ukraine crisis has brought a new supply shock. Central banks committed to tightening when the second shock made things worse.
Last Thursday (s. ; or for the full live stream, s. ), @SevimDagdelen from #DieLinke has discussed with @RaniaKhalek & @EugenePuryear esp. the recently decided & billion-dollar rearmament of the German #Bundeswehr...
...as a result of the #RussianFederation's military invasion of #Ukraine, as officially justified by the #GermanFederalGovernment. A recommendable interview! Besides her opposition to such rearmament & the associated fundamental departure...
...from the so-called „#Entspannungspolitik“ established by #WillyBrand & #EgonBahr for #Germany's relationship with the #USSR (& also its territorially largest & politically strongest successor state in the form of the #RussianFederation),...
A few months ago, #markets expected U.S. #inflation to peak by mid-2022 at around 7% to 8% at the headline level and then anticipated that generalized #price gains would decline into year end, closing the year around 4%.
However, the tragic war now unfolding with Russia’s attack upon Ukraine has not only sent #energy prices skyrocketing but it has led to much greater uncertainty over #economic growth and #MonetaryPolicy reaction functions, in Europe and indeed around the world.
"Smartphones" trump food. #DigitalID
Nov 1 2021, #CBDC India: "so every single person today, even if he's not able to afford all the 3 meals, is having a #Smartphone in his hand. And I must thank some of the Asian countries which actually revolutionize[d] the smartphone market"
Nov 1 2021, #CBDC India: "so every single person today, even if he's not able to afford all the 3 meals, is having a #Smartphone in his hand. And I must thank some of the Asian countries which actually revolutionize[d] the smartphone market"
"so these three: the #biometric identity, the no-frills savings account [], & of course the #smartphone, & the fact that data is so cheap in India was the one which actually set the ground... I think #Canada & India started on this journey of instant payments almost together..."
Jan 18 2021, Payments #Canada: "Design attributes for a retail #CBDC... introduction of a new channel for illicit activities, money-laundering, terrorist financing other socially undesirable behaviours."
#DigitalID #Compliance #Surveillance
payments.ca/sites/default/…
#DigitalID #Compliance #Surveillance
payments.ca/sites/default/…
With respect to the data, #coreCPI (excluding volatile food and #energy components) came in at 0.6% month-over-month and at a high 6% year-over-year.
Meanwhile, headline #CPI data printed at a strong 0.6% month-over-month and came in at 7.5% year-over-year, the greatest increase over a 12-month period since February 1982.
Additionally, the @federalreserve’s favored measure of #inflation, #corePCE, increased 0.5% in December, bringing the year-over-year figure for the measure to 4.9%, as of that month.
/1
A thread on credit creation, money supply, and how the printer does (and doesn't) go brrrr 🧵🖨💸👇
First, banks don’t lend reserves – banks make a loan first, then they find reserves second (if necessary)...
#monetarypolicy #FederalReserve #Fed
A thread on credit creation, money supply, and how the printer does (and doesn't) go brrrr 🧵🖨💸👇
First, banks don’t lend reserves – banks make a loan first, then they find reserves second (if necessary)...
#monetarypolicy #FederalReserve #Fed
/2
If a bank extends a new loan, it creates a loan asset and a deposit liability on their balance sheet ⚖️:
loan deposit
📄 💵
asset liability
If a bank extends a new loan, it creates a loan asset and a deposit liability on their balance sheet ⚖️:
loan deposit
📄 💵
asset liability
/3
The bank only needs reserves against that loan in case the borrower wants to move his deposit to another bank:
e.g. A borrower from Bank ABC is a construction co who needs to buy materials from a supplier whose checking account is at Bank XYZ...
👷♂️↔️💁♀️
💸↔️🪵
The bank only needs reserves against that loan in case the borrower wants to move his deposit to another bank:
e.g. A borrower from Bank ABC is a construction co who needs to buy materials from a supplier whose checking account is at Bank XYZ...
👷♂️↔️💁♀️
💸↔️🪵
Speeches are an important element of central bank communication. After two years at the @ecb’s Executive Board, I would like to present a selection of the most relevant of my (more than 30) speeches in a long thread🧵. 1/18
There are several categories of speeches: (1) on #MonetaryPolicy, explaining current policy considerations, (2) on #Narratives about monetary policy, and on the relationship of monetary policy & (3) #FiscalPolicy, (4) #FinancialStability, (5) #Inequality, (6) #ClimateChange. 2/18
#MonetaryPolicy: There are too many speeches to list them all, so let me select a few: on the ECB’s response to the pandemic (6 Apr 2020), mentioning (AFAIK) the concept of the euro area GDP-weighted yield curve for the first time: 3/18 ecb.europa.eu/press/key/date…
With respect to today’s #inflation data, core #CPI (excluding volatile food and energy components) came in at 0.24% month-over-month and 4.04% year-over-year and was driven higher by strong increases in the #rent components, which have a tendency to be persistent.
Further, headline #CPI data printed at a solid 0.41% month-over-month and came in at 5.38% year-over-year.
