Real Vision: Finance & Investing Is the Fed Nailing the Soft Landing?
Dec 8, 2023
The podcast discusses the market's reaction to the US non-farm payroll number, the recent stock rally, and the potential for sectors outside of the big names to catch up. They also talk about the impact of economic factors on different countries, China's economy, and upcoming AI and crypto events.
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Conflicting US Labor Market Signals
- The US jobs report shows a complex picture with slowing job growth despite a low unemployment rate.
- Markets are recalibrating expectations about Fed rate cuts amidst mixed labor data.
Fed's Cautious Stance on Rate Cuts
- Despite expected rate cuts in 2024, the Fed funds rate will remain historically high above 4%.
- Powell aims to avoid inflation rebound by being cautious on rate cuts despite market pressure.
Supply Constraints Threaten Inflation
- Supply-side damage from higher rates may cause inflation to re-accelerate in coming years.
- Issues in rentals and trucking capacity are setting the stage for inflationary pressures despite current disinflation.