Prof G Markets Fed Holds Rates — Inflation Back in Focus
223 snips
Jan 29, 2026 
Michael Gapen, Morgan Stanley’s Chief U.S. Economist, on Fed policy, inflation dynamics, and the dollar’s moves. Gil Luria, DA Davidson’s Head of Technology Research, on Microsoft and Meta earnings, AI exposure, ad growth, and tech valuations. Multiple short conversations cover Fed strategy, currency swings, cloud and AI trends, and who stands to benefit from near-term AI profits.
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Fed’s Pause Is A Watchful Dovish Hold
- The Fed paused to see whether recent rate cuts were sufficient rather than signaling long-term inaction.
- Michael Gapen says the hold felt dovish: they expect disinflation could allow cuts later if realized.
Cuts Shift From Jobs To Inflation
- Future cuts are now framed as inflation-driven rather than labor-market driven.
- Gapen warns cuts depend on disinflation; persistent inflation could force hikes instead.
Tariffs Seen As Transitory Inflationary Force
- The Fed views tariff-driven goods-price rises as mostly transitory once pass-through completes.
- They see services inflation decelerating and expect inflation to come down over time.