Bostic: Open to cutting rates before July if convincing evidence of slower inflation

  • Open to starting rate cut before July if there is convincing evidence inflation is is long faster than he anticipates
  • Repeat baseline is for rate reductions starting in Q3, with care needed not to cut Toussaint and risk renewed demand and price pressures
  • size possibility conflicts around the world. Again complicate supply chains, risk that US budget fights and elections could affect the economy, and the financial markets
  • Gven uncertainty, unwise for event to mark in any approach at this point

Bostic has been more hawkish. Policy is a voting member on the 2024 FOMC Board. The market – despite the back up in yields recently – is still pushing for a cut sooner than the summer.

US stocks had dipped a bit:

  • S&P index is now up 10.27 points or 0.21% at 4749.23
  • NASDAQ index is up 118 points or 0.79% at 14972

US yields are higher with the longer end up more than the shorter end.

  • 2 year yield 4.369% +1.5 basis points
  • 10 year yield 4.149% +4.6 basis point
  • 30-year yield 4.378% +6.6 basis points

The 2-30 year yield value is back into positive territory at 0.9 basis points. The 2-10 year spread is higher but still negative at -22 basis. point.

This article was written by Greg Michalowski at Source