Trump’s Fed nominee would add a voice inside the central bank that is explicitly critical of the conventional wisdom around how tariffs might affect inflation and economic growth https://t.co/qiCXTuybKW ...

Welcome to Yahoo Finance's flagship show, The Morning Brief. I'm Julie Hyman. Let's get to the three things you need to know today.First up, US stock futures pointing to gains at the open. And the NASDAQ composite set to open at a new record high. It's the top performer this week, up nearly 3%.Even with the flurry of tariff headlines over the week, markets took it in stride, as they have been. But Bank of America's Michael Hartnett warning that investors are preparing for a pullback. In a new note, he says ...

Labor Market Analysis - The labor market is weaker than headline unemployment suggests due to sluggish hiring and declining labor supply, potentially influenced by immigration policies [1][2] - Businesses are not firing, but hiring is slow, contributing to the weakness in the labor market [1][2] - BLS data may require updates in practices, technology, and funding to maintain confidence in the numbers [4][5][9] - Alternative data sources and trends over three, six, or nine months should be considered to assess the labor market, rather than over-relying on any single data print [10][11] Monetary Policy and Economic Outlook - Prospects for future GDP growth have slowed from initial estimates of 225%-250% to 125%-150%, impacting treasury yields [17] - The ten-year treasury yield is influenced by supply and demand factors, future growth prospects, and deficits, with concerns about the amount of treasuries being sold [18][19] - The market anticipates a potential rate cut in September, but it is not a certainty due to conflicting factors such as above 2% inflation and sluggish growth [20][21][22] - The Fed faces a conflict between its dual mandates of employment and inflation, potentially requiring a serious look at cutting rates by 25 basis points in September [24][25] Fed Independence and Treasury Market - There is a strong culture of independence at the Fed, and the onus is on the chair to uphold that ethic [14] - Concerns exist regarding the weakening dollar and upward pressure on rates due to factors like firing a statistician and the rest of the world looking elsewhere [16] - The US is running a $2 trillion deficit, adding to concerns about the supply and demand of treasuries [18]

Japan cut its growth forecast for the current fiscal year as US tariffs and persistent inflation weigh on the economy, complicating the policy course of the Bank of Japan https://t.co/WXDrFv8ssA ...

Serbia’s central bank kept interest rates unchanged for an 11th month with growing inflation risks taking precedence over weaker economic growth https://t.co/Kwke6sYOqa ...

Economic Uncertainty & Recession Risks - Uncertainty, stemming from policy, geopolitical factors, and President Trump's attacks on the Federal Reserve, poses a significant threat to US economic growth [1][2] - Recession risks are higher than average, though not overwhelming, as the US consumer remains resilient [7][9] - Corporate investment is hindered by uncertainty, impacting medium to longer-term plans [5] Monetary Policy & Inflation - It's difficult to argue for lower interest rates currently due to uncertainty about future inflation [11] - There are no overwhelming signs of weakening economic activity that would call for monetary policy stimulus [12] - The pass-through of tariffs into higher prices has been modest so far, but it's still early stages [11] Immigration & Demographics - Slower population growth due to immigration shocks negatively impacts medium-term potential output [8][9] - Aging populations and declining birth rates in the US and other advanced economies impact potential growth [14] - Immigration has historically contributed to trend growth in the US economy [8][14] Debt & Fiscal Policy - The US budget bill is estimated to add at least $3 trillion to the deficit over the next 9 to 10 years [15] - High debt levels and debt servicing costs are a concern, potentially hindering more productive investments [17][18] Globalization & Trade - Globalization has been off its peak since the global financial crisis [20] - While globalization has benefited consumers through cheaper products, it has also led to a hollowing out of various sectors in the US [20][22] - Increased global cooperation is preferred over a fragmented system [22] Global Debt Crisis - The unfolding debt crisis in low-income countries is something to watch, as it could amplify to emerging markets with bigger footprints [24][25]

Indonesia’s economy is growing at its fastest pace in two years. Not all consumers are buying it. https://t.co/JZL7cAjUrl ...

Bank of America CEO Brian Moyahan says he does does not expect a recession despite today's disappointing ISM data. Take a listen to what he said. >> Our economists believe there'll be no recession.They believe the econ the economy in the US will go about 1 one and a half% this year. They believe that the Fed will not cut rates because inflation will take longer to get down. >> That the Fed will not cut rates >> during 25.They'll cut them at 26. And that they've been on that for a long time. And they believe ...

Market Outlook & Economic Growth - HSBC raises S&P 500 target to 6400, with a bull case of 7000 driven by AI optimism [2] - AI is seen as the primary driver of US economic growth, as consumer spending and labor market gains slow down [3] - The market may be adjusting to a slower pace of economic and services growth [4] - Earnings growth is concentrated in S&P 100 and Nasdaq companies, particularly in industrial sectors related to grid and data center build-outs [5] - Cloud computing and data center related activities are experiencing significant growth [6] Interest Rates & Fed Policy - Potential Fed rate cuts could revitalize the housing market and boost consumer spending [7] - The market is in a historically choppy period, with uncertainty surrounding the Fed's actions [9] - The market is awaiting signals from the Federal Reserve regarding potential rate cuts in September, which could stimulate the housing market [11] - There's debate on whether the Fed will cut rates due to concerns about inflation remaining above target, even with a potentially weakening labor market [14] - Some believe the Fed will prioritize caution and cut rates at the first sign of labor market weakness [15] Market Volatility & Investment Strategy - August is typically a volatile month for market performance [10][12] - Small position sizing is recommended in the current choppy market environment due to uncertainty about Fed rate cuts [13] - A potential 5-7% pullback from the high is anticipated, possibly triggered by weaker-than-expected ISM services data [19] - The market's reaction to upcoming jobless claims data will be important [20]

Economic Policy & Labor Market - A Japanese government panel recommended a record minimum wage increase for the second consecutive year [1] - The wage increase sends a positive signal to the Bank of Japan [1] - The policy aims to pursue demand-led economic growth in Japan [1]