FOMC: neutral real rates, accelerating growth and policy normalisation

A very interesting paper by Hamilton (et al.) out last week looked at the question of neutral real rates in the US (and elsewhere), and how they compared over time with average or ‘trend’ growth rates. Also out last week, was a really important speech by John Williams of the SF Fed, “The Economic Outlook … More FOMC: neutral real rates, accelerating growth and policy normalisation

US NFP: going from strength to strength, but wages disappoint

February payrolls surprised materially on upside, printing 295K vs median expectation of just 235K. The expected combination of payback from a run of very strong prints and bad weather didn’t materialise, and instead the old favourite of the 3-month moving average would have got you closer than anyone in the survey. Alongside the strong jobs … More US NFP: going from strength to strength, but wages disappoint

ECB: crisis avoided (again), but risks remain

Tomorrow we get to hear the latest from President Draghi on the outlook for the euro area, and more on the modalities of the QE programme. As part of their regular roadshows outside of Frankfurt, tomorrow comes from Cyprus. Which is kind of interesting, as with capital controls still in place there, is a Cypriot euro … More ECB: crisis avoided (again), but risks remain

RBA: no change, but with an easing bias

As I expected, the RBA held steady overnight, disappointing the market and the majority of economists on the street. However, the accompanying statement – while little changed in substance from February – gave a fairly clear steer that further easing is likely. The key final section says: “At today’s meeting the Board judged that, having eased … More RBA: no change, but with an easing bias

FOMC: dealing with the plumbing when it comes to liftoff

As promised on Friday, here are a few thoughts on the section of the last FOMC minutes around “Liftoff tools and options”. The first thing that struck me was the following: “In their discussion of these issues, participants generally agreed that it was very important for the commencement of policy firming to proceed successfully. Consequently, … More FOMC: dealing with the plumbing when it comes to liftoff