What Could Force A Fed Pivot? $800 Billion Sees Five Catalysts

What Could Force A Fed Pivot? $800 Billion Sees Five Catalysts

The "Bostic pause" story was a cruel canard. That much is now clear. In a subsequent interview with MarketWatch, Bostic himself sought to dispense with the notion that he was attempting to reinstate the vaunted "Fed put" when, during remarks to reporters following an address to the Rotary Club of Atlanta last month, he said it was possible the Fed could "pause" rate hikes in September to assess the impact of tightening delivered over the preceding four FOMC meetings. Since then, the Fed has pi
Subscribe or log in to read the rest of this content.

5 thoughts on “What Could Force A Fed Pivot? $800 Billion Sees Five Catalysts

  1. The idea of a Fed put for a level of the S&P is a bit of a false target. The Fed looks at a range of financial markets- the stock market is actually the least important one. The article points out junk spreads, but the Fed really looks at the overall functioning of the capital markets. That would be credit, FX, and the US Treasury market. A breakdown of liquidity in these markets is more likely to get the Fed off the hawkish bent- not a certain level of the S&P 500 or junk spreads. To your credit, you have previously indicated that speed matters a great deal. An orderly tightening of financial conditions such as a gentle decline in stocks and increased credit spreads would not get a Fed to react most likely unless macroeconomic variables also rolled over. But a disorderly unwind- that would be addressed PRONTO.

  2. Financial conditions tighten in an orderly fashion until they don’t, we are getting closer to a disorderly unwind probably combining several of the events picked by the survey, my money is that credit deterioration and spreads will be the key on the pivot.

Speak your mind

This site uses Akismet to reduce spam. Learn how your comment data is processed.

NEWSROOM crewneck & prints