Interest Rate & Economic Outlook - Interest rate cuts are anticipated to begin in 12 days [1] - The cuts are expected to stimulate economic growth, leading to wealth creation in Q4 [1]

President Donald Trump's efforts to pressure the Federal Reserve into lowering its benchmark interest rate could lead to higher borrowing costs for homebuyers and the federal government, experts say. https://t.co/WxBxU5iNlY ...

We're following another key hearing on Capitol Hill today where the future of the Federal Reserve took center stage. >> President Trump's nominee to fill an open Federal Reserve governor position testified before a Senate committee today. Steven Myin, who is a close Trump adviser, has been critical of the Fed, but today he repeatedly said that the independence of the central bank is crucial.If confirmed, Myron would be one of the officials voting on future interest rate decisions. So, let's bring in NBC New ...

New York Fed President John Williams said the US economy’s neutral interest rate may not be much different than before the pandemic, given the structural factors that have kept a lid on rates haven’t gone away https://t.co/7g44zxbXeu ...

Federal Reserve Chair Jerome Powell signals potential interest rate cut due to economic conditions at the Fed's annual conclave in Jackson Hole, Wyoming. For more context and news coverage of the most important stories of our day click here: https://www.msnbc.com/ » Subscribe to MSNBC: https://www.youtube.com/msnbc » Subscribe to MSNBC on TikTok https://www.tiktok.com/@msnbc » Subscribe to MSNBC on Instagram https://www.instagram.com/msnbc Download our new MSNBC app for the latest breaking news and daily he ...

Federal Reserve & Monetary Policy - President Trump calls for the resignation of Fed Governor Lisa Cook amidst mortgage fraud allegations [1][2] - The potential firing of Lisa Cook is seen as part of Trump's broader effort to influence the Fed and push for lower interest rates [4][10] - The market is currently pricing in three rate cuts by the end of the year, but concerns about inflation persist [14] - The Fed faces a difficult situation with conflicting signals from employment and inflation data [16] - The CME Group's Fed watch tool indicates around 80% probability of a September rate cut [12] Allegations Against Lisa Cook - Lisa Cook is accused of listing two different residences as her primary residence on mortgage applications [3][6] - The head of the Federal Housing Finance Agency (FHFA) has referred the allegations to the Justice Department [2][3] - It is noted that there may be circumstances where listing two primary residences is permissible, such as co-signing for a dependent [3][7] Market Expectations & Fed's Stance - The market anticipates Fed Chair Jerome Powell to slightly open the door to a rate cut in September [13] - Recent weak jobs numbers and downward revisions to hiring in May and June could tilt the scales towards a rate cut [14] - The minutes from the recent FOMC meeting revealed that most Fed members remain focused on inflation [11][13] - Only two out of twelve Fed members indicated that the risks of lower employment outweigh those of inflation [12]

Economic Outlook - The Federal Reserve Chair Jerome Powell will discuss the U S economy [1] - Powell's remarks will include the inflation outlook [1] - Potential interest rate forecasts will be addressed at the Jackson Hole Economic Policy Symposium [1] Monetary Policy - The speech may provide insights into the Federal Reserve's future monetary policy decisions [1]

Monetary Policy & Framework - The industry observes an odd timing for a major new framework announcement from the Fed, suggesting it should be addressed by the incoming chairman after consultation [1][2] - The industry notes the Fed's past errors leaned towards excessive transparency and forecasting, leading to iatrogenic volatility, and suggests fewer dot plots and forecasts [2][3] - The industry suggests a return to a more vague and oracular approach, similar to Volcker and Greenspan, given the current challenge of preventing high inflation expectations from becoming embedded [4][5] - The industry emphasizes the importance of symmetry with respect to inflation and learning from the previous framework's shortcomings [6] - The industry highlights the need for careful consideration of the management of the maturity structure of the federal debt, especially when the Treasury and the Fed have conflicting objectives [7] Inflation & Interest Rates - The industry acknowledges persistent inflation above the 2% target, yet markets anticipate a Fed rate cut in September [8] - The industry notes evidence of economic weakening is likely driving market expectations for a Fed rate ease [9] - The industry interprets the market's anticipation of a 25 basis point cut in September as a likelihood, with possibilities of 50 basis points or zero being equally likely [10] - The industry cautions against certainty about future actions, as data could push towards a 50 basis point cut or further delay [11] Economic & Geopolitical Considerations - The industry expresses surprise at the Treasury Secretary's prescriptive stance on monetary policy, suggesting a 175 basis point cut [12][13] - The industry suggests elevated deficit spending, data center spending, reduced trade deficits, and higher asset prices may be raising the net demand for funds, potentially increasing neutral interest rates [15] - The industry expresses disappointment that President Trump hasn't leveraged frozen Russian reserves to drive a just peace with Ukraine [17][18]

Interest Rate Analysis - Models suggest a "neutral" interest rate would be approximately 1.5 percentage points lower [1] Monetary Policy Outlook - Bessent isn't predicting a series of interest-rate cuts from the Federal Reserve [1]

Market Expectations & Rate Cut Probabilities - Market participants initially interpreted the inflation data as a signal for the Federal Reserve to cut rates, with some pricing in near certainty and even anticipating up to four rate cuts for the remainder of the year [2][3] - The market's reaction suggests a belief that the Fed can now focus on the labor market and cut rates without excessive concern about inflation, leading to small caps outperforming due to their interest rate sensitivity [6] - There's a perception that the Fed has some leeway to cut rates, especially given the labor market conditions, and that a rate-cutting cycle, if significant, would be very beneficial for the market [8][9] Inflation Data Analysis - The headline inflation number initially excited the market, but a closer look revealed it might be "a little hotter than expected," reinforcing the idea that inflation remains a problem [2] - Core inflation was noted as being the highest since the start of the year, indicating that the inflation data wasn't entirely positive and had some underlying heat [4][5] - The inflation data showed some signs of giving ground, which, combined with potential cracks in the labor market, could provide the Fed with justification to cut rates [5] Bond Market Reaction - The ten-year Treasury yield initially pulled back on the report but then bounced higher, finishing the day almost unchanged, indicating uncertainty or mixed signals in the bond market's interpretation of the data [4] Economic Indicators & Market Valuation - Concerns are raised about applauding the stock market's performance given a GDP growth of 125% (it seems there is a typo here, it should be 125 basis points or 125%) and unemployment growth of 270% (it seems there is a typo here, it should be 270 basis points or 270%), with the Fed funds rate at 45% (it seems there is a typo here, it should be 450 basis points or 450%) [10] - The stock market is trading at all-time highs, with valuations around 225% to 240% (it seems there is a typo here, it should be 225x to 24x) times forward earnings, suggesting potential overvaluation [11] - The market's behavior is considered odd, suggesting that the economy might be starting to flex, and market participants are chasing that momentum [12]