Monetary Matters with Jack Farley Joseph Wang & George Goncalves on Rates, Tariffs, Fed’s Balance Sheet, and Yen Carry Trade
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Nov 27, 2024 Joseph Wang, a former senior trader at the New York Fed and author of "Central Banking 101," teams up with George Goncalves, Head of US Macro Strategy at MUFG Securities. They delve into the Federal Reserve's strategy for 2025, examining the impact of rising interest rates and political shifts. The duo discusses the challenges of small businesses amidst high rates, the implications of trade tariffs, and potential rate cuts. They explore how these factors could influence market sentiment, the economy, and future Federal Reserve policies.
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Fed's 2025 Game Plan
- The Federal Reserve's 2025 game plan involves reacting to political and economic uncertainty.
- They must consider stimulative tax cuts alongside potentially inflationary tariffs and migration impacts.
Market Perception of Trump's Policies
- The market views Trump's policies as inflationary, influencing current perceptions.
- However, the impact on inflation is still uncertain, and recent job data has been weak.
Rate Cut Necessity
- The Federal Reserve's September forecast was based on a December rate cut.
- Recent data suggests the economy has performed better than the Fed anticipated, potentially negating the need for a cut.
