Core Viewpoint - The Federal Reserve Governor Milan stated that there is currently no substantial evidence linking tariffs to inflation, which appears to be causing hesitation among other Federal Reserve decision-makers [1] Group 1 - The lack of evidence regarding tariffs causing inflation is highlighted [1] - The hesitation among Federal Reserve decision-makers is noted as a consequence of the current findings [1]

Group 1 - The core viewpoint of the report indicates that as the new fiscal year approaches, the risk of a U.S. government shutdown is increasing, with market expectations of a shutdown probability nearing 80% [1][6][8] - The report highlights that if the government shuts down, economic data will be suspended, complicating Federal Reserve decision-making, and the likelihood of a gradual interest rate cut path may increase [2][11][12] - The report notes that the two parties in Congress are deeply divided over the new funding bill, with the Democrats seeking to restore nearly $1 trillion in medical assistance cuts, while Republicans aim to maintain spending cuts from the tax reform [4][5][6] Group 2 - The report states that historically, government shutdowns have occurred 15 times since 1980, with durations ranging from one day to several weeks, impacting economic indicators and market performance [9][10] - It is mentioned that during a government shutdown, GDP growth is expected to slow by approximately 1 percentage point, but will rebound quickly once the shutdown is resolved [11][13][14] - The report indicates that during shutdowns, U.S. stock market returns typically decline, while gold prices tend to rise, especially if the shutdown lasts longer [15][16][17]

Core Insights - U.S. consumer spending showed unexpectedly strong momentum in August, with retail sales data increasing for the third consecutive month [1][2] - Real retail sales adjusted for inflation increased by 2.1% year-over-year, marking the 11th consecutive month of positive growth [1][4] Retail Sales Performance - Retail sales in August rose by 0.6% month-over-month, exceeding expectations of 0.2%, and the previous month's increase of 0.5% [3] - Retail sales excluding automobiles increased by 0.7%, surpassing the expected 0.4% [3] - Retail sales excluding both automobiles and gasoline also rose by 0.7%, against an expectation of 0.4% [3] Sector Contributions - The growth in August was broad-based, with 9 out of 13 major categories reporting increases [1] - Online retailers, clothing stores, and sporting goods stores led the growth, likely reflecting back-to-school shopping [1] - Restaurant spending rebounded by 0.7% after a decline in the previous month [1] Economic Implications - The strong retail performance contrasts with market concerns about an economic slowdown and may influence Federal Reserve decision-making [7] - The "control group" sales, which exclude food services, auto dealers, building materials, and gas stations, rose by 0.7%, serving as a key indicator for consumer demand [7]

Core Points - The U.S. Department of Justice plans to investigate Federal Reserve Governor Cook and urges Fed Chairman Powell to dismiss her [1][4] - President Trump has intensified pressure on the Federal Reserve's decision-making body, criticizing Powell for not lowering interest rates and calling for Cook's resignation [1][4] Group 1 - Cook is facing scrutiny over two mortgage loans, with calls for a stricter review from the Director of the Federal Housing Finance Agency, who suggested potential criminal implications [4] - Cook has stated she will take the inquiries regarding her personal financial history seriously but refuses to resign due to social media posts [4] - Cook became the first Black woman to serve as a Federal Reserve Governor in May 2022 and was reappointed in September 2023, with a term extending to 2038 [4]

Core Viewpoint - President Trump is intensifying pressure on the Federal Reserve, particularly targeting Governor Lisa Cook, demanding her resignation and criticizing Fed Chair Jerome Powell for not lowering interest rates [1][3]. Group 1: Pressure on Federal Reserve - Trump has publicly called for Lisa Cook to resign, stating "Cook must resign, now!!!" on his social media platform [1]. - He shared a Bloomberg report highlighting calls for stricter scrutiny of Cook's mortgage applications, which have raised allegations of potential misconduct [1]. Group 2: Response from Lisa Cook - Cook explained that the mortgage applications in question occurred before she joined the Federal Reserve and expressed her intent to address any reasonable inquiries regarding her financial history [2]. - She emphasized that she does not intend to resign due to social media posts and is committed to providing accurate information [2]. Group 3: Legal and Institutional Context - It remains unclear if the Justice Department will investigate Cook, as the President cannot arbitrarily dismiss Federal Reserve officials without just cause [3]. - Trump's dissatisfaction with the Fed's refusal to lower interest rates has led to repeated attacks on both Powell and Cook, with Cook being the first Black woman to serve as a Fed Governor [3].

Core Viewpoint - President Trump has intensified pressure on the Federal Reserve, specifically targeting Governor Lisa Cook, demanding her resignation amid allegations of mortgage fraud [1][2][3] Group 1: Pressure on Federal Reserve - Trump has publicly criticized Fed Chair Jerome Powell for not lowering interest rates and has now directed his ire towards Cook, calling for her resignation on social media [1] - The call for Cook's resignation follows a report by Bill Pulte, who has suggested that Cook's mortgage applications should be scrutinized more closely [1] Group 2: Cook's Response - Cook has stated that the mortgage applications in question occurred before she joined the Federal Reserve and has expressed her intention to address any reasonable inquiries regarding her financial history [2] - She emphasized that she will not resign due to what she perceives as bullying tactics [2] Group 3: Legal and Institutional Context - It remains unclear whether the Department of Justice will investigate Cook, as the President cannot arbitrarily dismiss Federal Reserve officials without just cause [3] - Cook, who was appointed during the Obama administration, is the first Black woman to serve as a Federal Reserve Governor and has recently been reappointed for a term lasting until 2038 [3]

Group 1 - The recent personnel and policy movements at the Federal Reserve have garnered significant global market attention, particularly regarding the succession of Powell and potential monetary policy adjustments [1] - The list of candidates for Powell's successor has expanded to approximately ten individuals, including notable figures such as former St. Louis Fed President James Bullard and former economic advisor to George W. Bush, Mark Soumerin [3] - The departure of Fed Governor Adriana Kugler has accelerated changes within the Federal Reserve Board, with Trump nominating Stephen Moore to fill the vacancy, which is seen as a significant shift in the decision-making structure of the Fed [4] Group 2 - The expansion of the candidate list for Powell's successor indicates a shift from previous narrowing down to just a few names, reflecting a more dynamic selection process [3] - Stephen Moore's background in economic policy and his previous roles in the Trump administration suggest that his appointment could influence the Fed's approach to interest rate discussions, especially in the context of rising expectations for rate cuts [4]

Core Viewpoint - Federal Reserve Chairman Jerome Powell stated that decisions cannot be made based solely on the June projections (dot plot) six weeks later [1] Group 1 - The Federal Reserve's decision-making process is dynamic and cannot rely on past forecasts [1] - Powell emphasized the importance of current economic conditions over previous predictions [1] - The statement indicates potential shifts in monetary policy based on evolving economic data [1]

Core Viewpoint - Federal Reserve Chairman Jerome Powell stated that decisions cannot be made based solely on the June forecasts (dot plot) in six weeks [1] Group 1 - Powell emphasized the need for updated information before making future decisions [1] - The statement indicates potential uncertainty in monetary policy direction [1]

Group 1 - A survey conducted by Reuters indicates that out of 98 analysts surveyed, 66 expressed concerns regarding the quality of U.S. statistical data and its impact on Federal Reserve decision-making [1]