Fed’s Waller is on the wires saying:
- Recent data has made me more comfortable with ideas of a 50 basis point hike in December and possibly smaller corporate increases thereafter.
- Will monitor data by December before deciding next policy step
- We still have a long way to gos
- Should increase until 2023
- Monetary policy should be aggressive to reduce inflation .
- The higher the policy rate, the stronger the case for slowing increases to 50 basis points
- Fed policy is very restrictive territory
- the end point of the Fed’s course tightening is highly dependent on inflation data
- The Fed will hit its terminal rate long before inflation hits 2%
- the labor market may ease, inflationary pressure may decrease, but not enough to change the view of an appropriate monetary policy
- the slowdown in economic activity is a sign that the Fed’s actions to reduce inflation are working
- looking for continued downward pressure on commodity prices
- moderation in CPI welcome, but I won’t be rigged by 1 reports
- Will watch shelter inflation moderating, don’t expect it for at least several months
- I believe we can expect wage growth to slow
US stocks are somewhat flat, with the NASDAQ leading the way lower.
- The NASDAQ index is currently down -163 points or -144% at 11194.95.
- The Dow Industrial Average is slightly lower by 11 points -0.03% at 33,581.45.
- The S&P index is down 30 points -0.75% to 3961.50.
In the US debt market,
- 2-year yield 4.371%, +1 basis point
- 10-year yield 3.7028%, -9.6 basis points
- 30 years 3.870%, -11.0 basis points
The US Treasury auctioned off $50 billion of 20-year bonds at a high yield of 4.072%, the current yield is 4.080% or -13 basis points. The bend in the yield curve between 10- and 30-year issues sometimes makes rising yields advantageous