Group 1: US Economic Overview - The US federal government shutdown has lasted 36 days as of November 5, marking the longest shutdown in US history, potentially reducing Q4 GDP growth by up to 2 percentage points[2][3] - The October ISM Manufacturing PMI is at 48.7, indicating contraction for the eighth consecutive month, while the ISM Services PMI rose to 52.4, the highest in eight months[3][4] - The ADP employment report for October shows an increase of 42,000 jobs, significantly exceeding the expected 30,000[3][4] - The probability of a 25 basis point rate cut in December has increased from 63% to 66.9%[4] Group 2: Global Economic Trends - Eurozone's October Manufacturing PMI is at 50, while Services PMI is at 53, indicating stable economic conditions[5][8] - Japan's nominal wages increased by 1.9% year-on-year in September, supporting the Bank of Japan's tightening policy[6][8] - Global stock markets have collectively declined, with US indices like the S&P 500 and Nasdaq dropping by 1.6% and 3.0% respectively[10][12] - Commodity prices, including oil and gold, have decreased, reflecting suppressed global risk appetite[10][17] Group 3: Risks and Predictions - Risks include potential unexpected impacts from Trump's policies, higher-than-expected stagflation in the US, and increased volatility in global financial markets[22] - The GDPNow model predicts a 4.0% annualized growth rate for Q3 2023 in the US[3][4]

Economic Growth Expectations - The FOMC members project a median GDP growth of 1.6% for 2025, 1.4% for 2026, and 1.8% for both 2027 and 2028, with a long-term median growth rate of 1.8% [2] - The central tendency for 2025 GDP growth is between 1.4% and 1.7%, with a range of 1.3% to 2.0% [2] Unemployment Rate Projections - The median unemployment rate is forecasted to be 4.5% for both 2025 and 2026, 4.3% for 2027, and 4.2% for 2028, with a long-term median of 4.0% [3] - The central tendency for 2025 unemployment rate is between 4.4% and 4.5%, with a range of 4.2% to 4.6% [3] Inflation Trends - The median forecast for the PCE price index year-on-year growth is 3.0% for 2025, 2.6% for 2026, 2.1% for 2027, and 2.0% for 2028, with a long-term median of 2.0% [4] - The core PCE inflation forecast (excluding food and energy) is 3.1% for 2025, 2.6% for 2026, 2.1% for 2027, and 2.0% for 2028 [4] Interest Rate Path - The median forecast for the federal funds rate is 3.6% at the end of 2025, 3.4% for 2026, and 3.1% for both 2027 and 2028, with a long-term median of 3.0% [5] - The central tendency for the 2025 interest rate is between 3.6% and 4.1%, with a range of 2.9% to 4.4% [5] Comparison with Previous Forecasts - Compared to the June 2025 forecast, the median predictions for GDP growth, unemployment rate, PCE inflation, core PCE inflation, and federal funds rate remain unchanged, indicating stable assessments by FOMC members [6] Uncertainty and Risk Assessment - FOMC members assess that the uncertainty regarding GDP growth and inflation for 2025 is "similar to or higher than" the past 20 years [7] - Some members view the risks for GDP growth and unemployment as "roughly balanced," while inflation risks are seen as "roughly balanced" or "tilted upward" [7]

Core Viewpoint - The Federal Reserve's latest economic forecasts indicate differing predictions for interest rate cuts, with Morgan Stanley projecting two cuts this year, while ING remains more pessimistic about the near-term outlook but optimistic for inflation in 2026 and 2027 [3][4]. Economic Growth Projections - Morgan Stanley forecasts a real GDP growth rate of 1.4% for 2025 and 1.6% for 2026, while ING predicts slightly lower growth rates of 1.3% and 1.5% respectively [3]. - For 2027, Morgan Stanley anticipates a growth rate of 1.8% [3]. Unemployment Rate Predictions - The unemployment rate is projected to be 4.6% in 2025 according to Morgan Stanley, while ING estimates it at 4.5% [4]. - For 2026, both institutions predict a slight decrease in the unemployment rate, with Morgan Stanley at 4.4% and ING at 4.5% [4]. Inflation Rate Forecasts - The PCE inflation rate is expected to be 3.1% in 2025 according to Morgan Stanley, while ING predicts it will be 3% [4]. - For 2026, both firms project a decline in inflation, with Morgan Stanley forecasting 2.5% and ING at 2.1% [4]. - The core PCE inflation rate is also expected to decrease, with Morgan Stanley predicting 3% for 2025 and 2.5% for 2026, while ING estimates 3.1% and 2.3% respectively [4]. Federal Funds Rate Expectations - The Federal Funds Rate is projected to be 3.875% in 2025 according to Morgan Stanley, while ING estimates it at 3.6% [4]. - For 2026, Morgan Stanley anticipates a rate of 3.375%, compared to ING's prediction of 3.4% [4].

Core Insights - The Bank of Spain forecasts a quarter-on-quarter GDP growth of 0.6% to 0.7% for the third quarter, indicating a sustained robust expansion trend [1] - The GDP growth forecast for 2025 has been revised upward from 2.4% to 2.6%, while the forecasts for 2026 and 2027 remain unchanged at 1.8% and 1.7% respectively [1] - The inflation rate forecast for 2025 has been slightly increased to 2.5%, up from the previous estimate of 2.4%, although it remains lower than the actual inflation rate of 2.9% in 2024, suggesting a gradual easing of overall inflationary pressures [1] - The fiscal situation shows positive improvement, with the forecast for the government budget deficit as a percentage of GDP for 2025 revised down from 2.8% to 2.5%, indicating strengthened fiscal discipline and a trend towards a more stable fiscal situation [1]

Group 1: U.S. Economic Policy - The Trump administration announced a plan to impose a 50% tariff on Indian products and indicated high tariffs on imported furniture[1] - U.S. new home sales in July fell 0.6% to an annualized rate of 652,000, exceeding market expectations of 630,000[1] - The U.S. Q2 GDP annualized growth rate was revised to 3.3%, higher than the expected 3.1%[1] - The core PCE price index for July rose 2.9% year-on-year, the highest since February 2025, matching expectations[1] - The probability of a 25 basis point rate cut in September increased from 75% to 86.4%[1] Group 2: European Economic Policy - The Eurozone economic sentiment index fell to 95.2 in August, down from 95.7 in July, breaking previous market expectations for a slight recovery[1] - The European Commission proposed legislative measures to implement tariff reductions on U.S. industrial goods and ensure U.S. tariff reductions on EU automobiles[1] Group 3: Global Market Performance - Global stock markets showed mixed performance, with most Asian markets rising while European and U.S. markets faced pressure[1] - The 10-year U.S. Treasury yield fell by 3 basis points to 4.23%, while 20-30 year yields rose, indicating inflation concerns[1] - Gold prices increased due to rising concerns over the credibility of the U.S. dollar amid the Federal Reserve appointment controversy[1]

Core Viewpoint - The Bank of Canada’s monetary policy report does not provide economic forecasts but highlights uncertainties stemming from U.S. tariffs [1] Group 1 - The report emphasizes the lack of economic predictions, indicating a cautious approach by the Bank of Canada [1] - It specifically points out the uncertainties related to U.S. tariffs, which could impact the Canadian economy [1]

Core Viewpoint - The Swedish Finance Minister stated that the economic forecast made in June remains largely valid [1] Group 1 - The economic predictions made in June are still applicable, indicating stability in the economic outlook [1]

Group 1 - The central bank governor of Israel indicated that the economic forecasts are subject to both upward and downward risks due to the developments in geopolitical situations [1]

Core Viewpoint - The Federal Reserve has decided to maintain the federal funds rate target range at 4.25%-4.5%, consistent with market expectations, marking four consecutive months of unchanged rates. The Fed had previously cut rates by 100 basis points over the past year [1][6]. Economic Projections - The Fed has revised its economic growth forecast for the U.S. down from 1.7% to 1.4% for this year, a decrease of 0.3 percentage points from the March projection. The growth forecast for 2026 has been adjusted from 1.8% to 1.6%, while the 2027 forecast remains at 1.8% [6]. - The unemployment rate is projected to be 4.5% for this year, an increase of 0.1 percentage points from the March forecast. The PCE inflation forecast for this year is set at 3%, up from the previous estimate of 2.7%. The forecast for core PCE inflation is 3.1%, compared to 2.8% in March [6]. Dot Plot Insights - The dot plot indicates that 8 members support two rate cuts this year, a decrease of one from the March dot plot, while 7 members favor maintaining the current rate, an increase of three. This suggests a growing divergence within the Fed regarding future monetary policy [2][4]. Interest Rate Projections - The median projection for the federal funds rate remains at 3.9% for 2025, while the 2026 median projection has been raised from 3.4% to 3.6%. The long-term neutral rate expectation remains at 3% [1][5].

Group 1 - The core viewpoint is that the differences in interest rate paths among officials reflect the diversity of economic forecasts, including inflation [1]