Bloomberg Daybreak: US Edition
Daybreak Weekend: Fed Meeting, ECB Decision, RBA Preview
Jan 25, 2025
James McIntyre, a Bloomberg economist with a focus on Australia and New Zealand, joins to discuss the intricacies of the Australian economy. He analyzes upcoming consumer price index data, highlighting how inflation trends will impact the Reserve Bank of Australia’s decisions. The conversation also covers high interest rates, unexpected job growth amid cooling property markets, and the economic interplay with China’s improving GDP. Insights into the U.S.-China trade relations add another layer to the economic landscape.
38:27
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Quick takeaways
- The Federal Reserve is expected to maintain its current monetary policy while closely monitoring inflation expectations and Trump's potential economic policies.
- Tech earnings are anticipated to show robust growth driven by AI investments, despite challenges faced by companies like Apple in China.
Deep dives
Federal Reserve's Stance and Impact on the Economy
The Federal Reserve is expected to maintain its current monetary policy during its upcoming meeting, following three consecutive rate cuts. Despite low unemployment and job creation exceeding forecasts, the number of long-term unemployed has reached a three-year high, indicating a tight labor market without substantial hiring. Inflation remains stable, with December's Consumer Price Index showing a year-over-year increase of 2.9%, suggesting that while inflation is not out of control, it is not yet at the Fed's target. The Fed is closely monitoring inflation expectations, as rising perceptions of future inflation could lead to increased wage demands, complicating their policy outlook.
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