Cookie Settings
Picture
Contact
Picture

The Fed is about to cut, as the labour market gets more attention.

In Short

Improvements in inflation and higher potential risks for the labour market are eventually leading the Fed to cut rates. Barring any very nasty surprises in the July and August price data releases, the September cut, which is already priced in by the market, is an almost done deal. The tone of the press releases clearly indicates the change in outlook and the shift in policy priorities (see below), with the unemployment mandate increasing in importance.

Highlights:

  • The first rate cut is only postponed, most likely to September. The Fed appears happy with the Q2 inflation progress and is shifting attention to the labour market outlook. 
  • The FOMC sees the economy as broadly rebalancing amid solid demand growth, and a significant downturn of the labour market appears a tail risk. But the string of good inflation prints was not yet long enough for a July cut.
  • Fed’s mild dovishness contrasts with the hawkish tilt of the BoJ Japan, which raised the policy rate to 0.25% earlier than expected and despite mixed evidence on inflation. Further monetary tightening will come from the widely expected start in the reduction of asset purchases. 
     

Download the full publication below

The Fed is about to cut, as the labour market gets more attention
Investment Capabilities
Funds
Responsible Investing
Insights

The latest views, research and investment insights from the experts of our ecosystem



About Us
Picture

© Generali Investments, all rights reserved. This website is provided by Generali Investments and is considered as a marketing communication and financial promotion related to the products and services of the following companies belonging to the Generali group: Generali Investments Partners S.p.A. Società di gestione del risparmio, Generali Insurance Asset Management S.p.A. Società di gestione del risparmio, Generali Investments Luxembourg S.A. and Generali Investments Holding S.p.A. (hereinafter jointly, Generali Investments). Moreover, the website may contain marketing communication and financial promotion of products and services of companies part of the multi-boutique platform coordinated by Generali Investments Partners S.p.A. Società di gestione del risparmio, and in particular of Infranity, Sycomore Asset Management, Aperture Investors LLC., Plenisfer Investments SGR, Lumyna Investments, Sosteneo Infrastructure Partners SGR, Axis Retail Partners S.p.A. and Generali Real Estate S.p.A. Società di Gestione del Risparmio

Legal Information
Cookies Policy
Privacy Policy
Terms and Conditions
Copyright
Glossary