Bloomberg Surveillance Single Best Idea with Tom Keene: Rebecca Patterson & Ira Jersey
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Aug 12, 2025 The discussion kicks off with an analysis of the latest Consumer Price Index, exploring inflation's far-reaching consequences. Economists weigh in on how these changes could signal a potential economic slowdown. The conversation shifts to bond yields and historical parallels with the Federal Reserve's reactions. Predictions about upcoming rate cuts get attention, especially as the Jackson Hole meeting looms, potentially shaping future monetary policy. It's a deep dive into the interplay of economics and financial markets.
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New Regime For Inflation And Yields
- Rebecca Patterson argues we are in a new regime for inflation and bond yields.
- She expects cautious Fed cuts, likely starting in September, because inflation risk remains elevated.
Expect Modest, Sequenced Fed Cuts
- Watch for a sequence of modest Fed cuts rather than aggressive easing.
- Expect the first cut in September and interpret Jackson Hole commentary for Fed leanings.
Markets Priced For Multiple Cuts
- Ira Jersey sees the market pricing multiple cuts starting in September and expects cuts to continue once begun.
- He reasons Fed funds above current inflation implies room to cut toward neutral.