In this week's episode, our experts review the now-stale minutes from July’s Federal Open Market Committee (FOMC) meeting, Fed Chairman Jerome Powell’s new dovishness from the Jackson Hole Economic Symposium, and what to look out for in the coming weeks as we near the end of a notable summer.
Speakers:
Brian Pietrangelo, Managing Director of Investment Strategy
George Mateyo, Chief Investment Officer
Rajeev Sharma, Managing Director of Fixed Income
Stephen Hoedt, Head of Equities
02:30 – We highlight this week’s economic releases: the Labor Department reports that weekly unemployment claims rose slightly but remained stable over the past 18 months, and the National Association of Realtors reports that existing home sales rose by 2% in July.
03:43 – The July FOMC minutes were hawkish, and show Committee member concerns over tariff-driven inflation, elevated asset valuations, and that the current fed funds rate may not be far above neutral. The meeting pre-dated the weaker July employment report and subsequent shift in focus from inflation to the cooling jobs market.
04:52 – Federal Reserve Chair Jerome Powell appears to pivot towards a dovish stance and emphasizing the downside risks to the labor market at the Jackson Hole Economic Symposium; expectations of a rate-cutting cycle beginning in September shot up and Treasury yields dropped sharply in response.
07:47 – Political turmoil continues to put pressure on the Federal Reserve on allegations of mortgage fraud against Fed Governor Lisa Cook, who has been pressured to resign or face removal by President Trump.
12:45 – We discuss the apparent bifurcation in the economy, with weakness in consumer spending offset by strength in business investment, particularly in data centers and artificial intelligence.
16:46 – We anticipate how the market might react to an upcoming earnings report from Nvidia and news that the federal government is considering taking ownership positions in tech stocks.
Additional Resources
Read: Key Questions: How Does Key Wealth Define Quality Within Our Internally Managed Equity Strategies?
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