Monetary System

Editor's note: A version of this post was originally published at my Patreon account on 13 Jun I have another more macro post on the Fed I am developing for later today. But I wanted to run this one by you because I am seeing a lot of…

My expectation is for the Fed to raise rates, keep guidance the same but be slightly more hawkish.

The macro data are good enough for the Fed to dismiss economic concerns for adding a hike in December. The market is only pricing in this hike at 33.2%.

The US jobs number just came out and the figures were quite good. Two-year yields spiked on the news.

I continue to believe that the bond bear market thesis is flawed. Money managers following it will lose a lot of money.

By Marc Chandler This post first appeared on Marc to Market Investors are seeing turmoil in the capital markets and a decline in US interest rates, including at the short-end.  Some are suggesting that market has become less confident of…

As the Fed raises rates, it will likely be surprised both by how fragile EMEs are and by the spillover impact Fed policy still has abroad

Policy divergence is the driver of market vulnerabilities. The longer the US stands alone in tightening policy, the greater the stress on the financial system.

The possibility of the Fed causing the curve to invert is real. We will have 12-18 months at most to see what happens economically.

Given what I know about the Fed's reaction function, I believe pre-conditions favor Fed tightening irrespective of the slope of the yield curve.