Dollar slips as weak data boosts US rate cut bets

The dollar edged away from two-year highs on Friday after weak U.S. manufacturing activity data sparked worries that the trade conflict with China may hurt the world’s largest economy and affect the currency’s safe-haven status. The fall followed overnight data showing manufacturing activity hit its lowest level in almost a decade in May, suggesting a sharp slowdown in U.S. economic growth was under way. Escalating trade tensions and weak data have fuelled rate cut expectations from the Fed. Mon


The dollar edged away from two-year highs on Friday after weak U.S. manufacturing activity data sparked worries that the trade conflict with China may hurt the world’s largest economy and affect the currency’s safe-haven status. The fall followed overnight data showing manufacturing activity hit its lowest level in almost a decade in May, suggesting a sharp slowdown in U.S. economic growth was under way. Escalating trade tensions and weak data have fuelled rate cut expectations from the Fed. Mon
Dollar slips as weak data boosts US rate cut bets Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-24
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Dollar slips as weak data boosts US rate cut bets

The dollar edged away from two-year highs on Friday after weak U.S. manufacturing activity data sparked worries that the trade conflict with China may hurt the world’s largest economy and affect the currency’s safe-haven status.

Against a basket of six major currencies, the dollar was down 0.2% at 97.686 in early European trade and 0.7% off a two-year high of 98.371 hit the previous session.

The fall followed overnight data showing manufacturing activity hit its lowest level in almost a decade in May, suggesting a sharp slowdown in U.S. economic growth was under way.

Up to now, the bulk of the pain from the trade war has been felt in Asia, with economies from Singapore to Thailand all posting poor numbers.

“Lot of people for good reasons thought trade wars may be U.S. dollar-positive and other countries cannot retaliate,” said Commerzbank FX strategist Ulrich Leuchtmann.

“But in reality, it’s more difficult. This very disappointing PMI data and other factors like the Huawei story are all creating stress for the U.S. economy and derailing sentiment.”

President Donald Trump said on Thursday that U.S. complaints against Huawei Technologies Co Ltd might be resolved within the framework of a U.S.-China trade deal, while at the same time calling the Chinese telecommunications giant “very dangerous”.

Escalating trade tensions and weak data have fuelled rate cut expectations from the Fed. Money markets broadly expect one rate cut by October followed by another by January 2020.

The dollar weakness helped sterling recover slightly from a 4-1/2 month low while the euro briefly inched above $1.12 to hit a one-week high.

Against the yen, the dollar edged down to 109.50 yen, extending losses overnight, when it gave up two-thirds of a percent, its steepest drop in a single session in two months.

The euro might have also been helped by the Dutch part of the EU parliamentary elections, in which an exit poll showed the Labour party of European Commissioner Frans Timmermans won a surprise victory over a Eurosceptic challenger who had been topping opinion surveys.

The euro has been pinned lower in recent weeks by the prospect of Eurosceptic parties across the continent performing well in the elections.


Company: cnbc, Activity: cnbc, Date: 2019-05-24
Keywords: news, cnbc, companies, slips, rate, twoyear, overnight, cut, yen, trade, dollar, hit, weak, data, boosts, bets, euro


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Three states, including two big ones for the 2020 election, just set new lows for unemployment

A job recruiter wears a shirt showing all of the Wal-Mart Stores Inc. brands during a career fair at the Sheraton Hotel in Philadelphia, Pennsylvania. At a time when the national unemployment rate is at its lowest in nearly half a century, three states have set all-time records. Vermont’s lowest-in-the-nation 2.2% jobless rate represents a new historic mark for the Green Mountain state, according to a report Friday from the Bureau of Labor Statistics.


A job recruiter wears a shirt showing all of the Wal-Mart Stores Inc. brands during a career fair at the Sheraton Hotel in Philadelphia, Pennsylvania. At a time when the national unemployment rate is at its lowest in nearly half a century, three states have set all-time records. Vermont’s lowest-in-the-nation 2.2% jobless rate represents a new historic mark for the Green Mountain state, according to a report Friday from the Bureau of Labor Statistics.
Three states, including two big ones for the 2020 election, just set new lows for unemployment Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-17  Authors: jeff cox
Keywords: news, cnbc, companies, big, statistics, ones, including, showing, set, states, lows, unemployment, election, walmart, wears, shirt, state, stores, 2020, rate


Three states, including two big ones for the 2020 election, just set new lows for unemployment

A job recruiter wears a shirt showing all of the Wal-Mart Stores Inc. brands during a career fair at the Sheraton Hotel in Philadelphia, Pennsylvania.

At a time when the national unemployment rate is at its lowest in nearly half a century, three states have set all-time records.

Vermont’s lowest-in-the-nation 2.2% jobless rate represents a new historic mark for the Green Mountain state, according to a report Friday from the Bureau of Labor Statistics.


Company: cnbc, Activity: cnbc, Date: 2019-05-17  Authors: jeff cox
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Fed’s Neel Kashkari says rate hikes ‘were not called for’ and that policy has been ‘too tight’

In an unusually harsh rebuke of central bank actions, Kashkari said the central bank shouldn’t have tightened monetary policy with inflation so low. “In my view, these rate increases were not called for by our symmetric framework,” Kashkari said during a speech in Santa Barbara, California. He based his position on a job market that is still growing even though wage gains are still tame, and inflation is averaging around 1.6%. Even with the low rate, another gauge that includes discouraged worke


In an unusually harsh rebuke of central bank actions, Kashkari said the central bank shouldn’t have tightened monetary policy with inflation so low. “In my view, these rate increases were not called for by our symmetric framework,” Kashkari said during a speech in Santa Barbara, California. He based his position on a job market that is still growing even though wage gains are still tame, and inflation is averaging around 1.6%. Even with the low rate, another gauge that includes discouraged worke
Fed’s Neel Kashkari says rate hikes ‘were not called for’ and that policy has been ‘too tight’ Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-16  Authors: jeff cox
Keywords: news, cnbc, companies, inflation, hikes, feds, policy, rates, neel, low, market, job, tight, fed, kashkari, rate, called, target


Fed's Neel Kashkari says rate hikes 'were not called for' and that policy has been 'too tight'

The Federal Reserve erred by raising interest rates during the recovery, part of a policy implementation that misread key signals and threatened to send the economy into recession, Minneapolis Fed President Neel Kashkari said Thursday.

In an unusually harsh rebuke of central bank actions, Kashkari said the central bank shouldn’t have tightened monetary policy with inflation so low. Instead, he said, the policymaking Federal Open Market Committee should be signaling that it will allow inflation to run higher than the 2% target, a move that would send a clear signal that the Fed is serious about stimulating the economy.

The FOMC hiked rates nine times starting in December 2015 as part of an effort to normalize policy following the extreme accommodations made during and after the financial crisis and Great Recession. Those hikes came even as inflation stayed well below the Fed’s goal.

“In my view, these rate increases were not called for by our symmetric framework,” Kashkari said during a speech in Santa Barbara, California.

The remarks came as part of a review the Fed is doing of its framework and the approach it has taken to jolting the economy back to life.

They also jibe closely with sentiments from the White House. President Donald Trump has repeatedly criticized the rate hikes and has said the economy would be much stronger had the Fed backed off.

While acknowledging the aggressive measures the central bank took — bringing its target rate down to near-zero and implementing three rounds of asset purchases that took its balance sheet to $4.5 trillion — Kashkari said the Fed should have kept its foot on the pedal.

He based his position on a job market that is still growing even though wage gains are still tame, and inflation is averaging around 1.6%.

“With inflation somewhat too low and the job market still showing capacity after 10 years, the only reasonable conclusion I can draw is that monetary policy has been too tight in this recovery,” he said.

Kashkari said one of the main problems was that Fed officials didn’t see how low unemployment could go without generating inflation. The current unemployment rate is at 3.6%, the lowest reading in nearly 50 years.

“I believe that we misread the labor market, thinking we were at maximum employment when, in fact, millions of Americans still wanted to work, and fearing that if we hit maximum employment, inflation might suddenly accelerate, and we would then have to raise rates quickly to contain it,” he said.

“The headline unemployment rate has been giving a faulty signal,” he added.

Even with the low rate, another gauge that includes discouraged worker and those holding part-time positions for economic reasons remains at 7.3%, reflective of slack remaining in the job market.

Kashkari said the lesson from the tightening cycle is that the Fed probably will want to be even more aggressive with policy in the next downturn. Evidence of tightening too fast came in the fourth quarter of 2018, when markets feared the Fed would continue raising rates and reducing its balance sheet and sold off aggressively.

“Perhaps we’d have achieved maximum employment already if monetary policy had been more accommodative,’ he said, adding that “by raising rates more quickly than called for by our symmetric framework, we ran the risk of overtightening and causing a recession. Markets signaled this risk with the steep drop in bond yields and equity prices late last year. The FOMC’s quick adjustment to pause further rate hikes was appropriate and, thankfully, seems to have mitigated this risk for now.”

However, he said he fears what may happen next time if the Fed doesn’t do a better job of listening to economic and market signals.

“For our current framework to be effective and credible, we must walk the walk and actually allow inflation to climb modestly above 2 percent in order to demonstrate that we are serious about symmetry,” Kashkari said. “Make-up strategies such as price-level targets offer this attractive feature. But we must honestly ask ourselves: If we felt compelled to raise rates when inflation was below target in this recovery, would we really keep rates low when inflation is above target next time? Count me as skeptical.”


Company: cnbc, Activity: cnbc, Date: 2019-05-16  Authors: jeff cox
Keywords: news, cnbc, companies, inflation, hikes, feds, policy, rates, neel, low, market, job, tight, fed, kashkari, rate, called, target


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The Atlanta Fed’s GDP forecast is sliding, and expectations for rate cuts are surging

A Federal Reserve projection on economic growth just weakened substantially, and expectations for a rate cut over the next eight months got a lot stronger. The Atlanta Fed’s closely watched GDPNow tracker is pointing to a 1.1% gain for the economy in the second quarter, according to a revision posted Wednesday. Disappointing retail sales in April fueled the latest leg down in the Atlanta Fed outlook. The Commerce Department reported Wednesday that sales declined 0.2% for the month against expect


A Federal Reserve projection on economic growth just weakened substantially, and expectations for a rate cut over the next eight months got a lot stronger. The Atlanta Fed’s closely watched GDPNow tracker is pointing to a 1.1% gain for the economy in the second quarter, according to a revision posted Wednesday. Disappointing retail sales in April fueled the latest leg down in the Atlanta Fed outlook. The Commerce Department reported Wednesday that sales declined 0.2% for the month against expect
The Atlanta Fed’s GDP forecast is sliding, and expectations for rate cuts are surging Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-15  Authors: jeff cox
Keywords: news, cnbc, companies, substantially, retail, feds, cuts, sliding, watched, weakened, sales, gain, gdp, forecast, expectations, rate, surging, atlanta, months, 02


The Atlanta Fed's GDP forecast is sliding, and expectations for rate cuts are surging

A Federal Reserve projection on economic growth just weakened substantially, and expectations for a rate cut over the next eight months got a lot stronger.

The Atlanta Fed’s closely watched GDPNow tracker is pointing to a 1.1% gain for the economy in the second quarter, according to a revision posted Wednesday. That comes on the back of a strong first three months that saw a 3.2% gain and is substantially lower than CNBC’s Rapid Update survey, which puts the GDP tracking estimate at 2%.

Disappointing retail sales in April fueled the latest leg down in the Atlanta Fed outlook. The Commerce Department reported Wednesday that sales declined 0.2% for the month against expectations of a 0.2% gain. Along with the retail letdown, industrial production fell 0.5% against Wall Street estimates of a 0.1% gain.


Company: cnbc, Activity: cnbc, Date: 2019-05-15  Authors: jeff cox
Keywords: news, cnbc, companies, substantially, retail, feds, cuts, sliding, watched, weakened, sales, gain, gdp, forecast, expectations, rate, surging, atlanta, months, 02


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Trump says if Fed cuts interest rates, US will win trade war: ‘It would be game over, we win!’

President Donald Trump predicted Tuesday that China’s next move in the trade war will be a rate cut, and he pushed the Federal Reserve to follow suit in what he said would lead to a clear victory for the U.S. He said that should the central bank meet a China rate cut with one of its own, that would be “game over, we win!” The White House and Beijing have hit an impasse in their ongoing trade negotiations. Washington is looking for a lowering of barriers into China and for the nation to halt the


President Donald Trump predicted Tuesday that China’s next move in the trade war will be a rate cut, and he pushed the Federal Reserve to follow suit in what he said would lead to a clear victory for the U.S. He said that should the central bank meet a China rate cut with one of its own, that would be “game over, we win!” The White House and Beijing have hit an impasse in their ongoing trade negotiations. Washington is looking for a lowering of barriers into China and for the nation to halt the
Trump says if Fed cuts interest rates, US will win trade war: ‘It would be game over, we win!’ Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-14  Authors: jeff cox
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Trump says if Fed cuts interest rates, US will win trade war: 'It would be game over, we win!'

President Donald Trump predicted Tuesday that China’s next move in the trade war will be a rate cut, and he pushed the Federal Reserve to follow suit in what he said would lead to a clear victory for the U.S.

In a tweet that amounted to the latest salvo in the tariff dispute between the two nations, the president ramped up his pressure on the Fed to ease monetary policy.

He said that should the central bank meet a China rate cut with one of its own, that would be “game over, we win!”

The White House and Beijing have hit an impasse in their ongoing trade negotiations. Washington is looking for a lowering of barriers into China and for the nation to halt the theft of intellectual property. As recent talks stalled, China retaliated against Trump’s latest round of tariffs, announcing plans Monday to slap new levies on $60 billion worth of American goods.


Company: cnbc, Activity: cnbc, Date: 2019-05-14  Authors: jeff cox
Keywords: news, cnbc, companies, war, worth, winthe, trump, latest, cut, rates, fed, rate, trade, interest, china, cuts, president, white, game, washington, win


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Jeff Gundlach says investors can get rich off interest rate volatility ahead

Bond titan Jeffrey Gundlach isn’t sure which way bond yields are headed, but he does see a good bet that they’ll move a lot. Speaking Monday at the Sohn Conference in New York, the head of DoubleLine Capital said his best suggestion is on volatility in long-term rates. He recommended using the iShares 20+ Year Treasury Bond ETF as a way to execute the trade. In addition to the monetary policy shifts, which now see little chance of a rate hike or cut this year, there are fiscal policy questions.


Bond titan Jeffrey Gundlach isn’t sure which way bond yields are headed, but he does see a good bet that they’ll move a lot. Speaking Monday at the Sohn Conference in New York, the head of DoubleLine Capital said his best suggestion is on volatility in long-term rates. He recommended using the iShares 20+ Year Treasury Bond ETF as a way to execute the trade. In addition to the monetary policy shifts, which now see little chance of a rate hike or cut this year, there are fiscal policy questions.
Jeff Gundlach says investors can get rich off interest rate volatility ahead Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-06  Authors: jeff cox
Keywords: news, cnbc, companies, rich, investors, interest, gundlach, way, policy, monetary, rate, ahead, volatility, conference, bond, sohn, etf, york, jeff


Jeff Gundlach says investors can get rich off interest rate volatility ahead

Jeffrey Gundlach speaking at the 24th Annual Sohn Investment Conference in New York on May 6, 2019.

Bond titan Jeffrey Gundlach isn’t sure which way bond yields are headed, but he does see a good bet that they’ll move a lot.

Speaking Monday at the Sohn Conference in New York, the head of DoubleLine Capital said his best suggestion is on volatility in long-term rates. Investors can express the bet through both put and call options at the same strike, or sale, price. Puts give investors the ability to buy, while calls provide the chance to sell.

Landing a number where the rate rises or falls more than the total premium on the option could allow investors to book big profits. Gundlach said 50% to 75% gains over the next 12 months wouldn’t be out of line.

He recommended using the iShares 20+ Year Treasury Bond ETF as a way to execute the trade.

“I think this is an extremely compelling time to do this trade and an extremely important environment where outcomes are so binary,” he said.

Gundlach runs the $50 billion DoubleLine Total Return Bond Fund.

The fund’s five-year performance is among the best in its category, though it has lagged most of its peers in 2019 with a gain of just 2%, according to Morningstar rankings.

Gundlach talked at length about the Federal Reserve and Chairman Jerome Powell, whose fickle moves have made it difficult to know just where monetary policy will be ahead. Gundlach used the term “policy fluid” to describe the state of affairs under the central bank chief.

“The problem is that policy fluidity suggests pretty much anything can happen almost without notice,” he said, pointing to several policy shifts from Powell since October 2018.

In addition to the monetary policy shifts, which now see little chance of a rate hike or cut this year, there are fiscal policy questions. Modern Monetary Theory, which posits that rates should be zero to allow the government to spend on programs that will fix the wealth cap, also is gaining popularity.

“Modern Monetary Theory is not a good idea,” Gundlach said. “It’s not modern, it’s not monetary, and it isn’t much of a theory.”

At the 2018 Sohn conference, Gundlach recommended a long play on SPDR S&P Oil & Gas Exploration & Production ETF and a short on Facebook. Both trades turned out poorly. The explorer ETF has slumped more than 24% over the past year while Facebook, though underperforming the broader market, is still up more than 9%.


Company: cnbc, Activity: cnbc, Date: 2019-05-06  Authors: jeff cox
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Wall Street is dangerously overestimating Fed rate cut odds, investor who oversees $135 billion in bonds warns

David Leduc believes too many investors are on the wrong side of the bond trade. Leduc, chief investment officer of Mellon’s active fixed-income team, blames it on a disconnect between Wall Street and the Federal Reserve. “The market is over-discounting the possibility of Fed cut this year.” “Risk assets, equity markets… as well as corporate bond assets have performed very strongly this year. Part of that performance in our opinion has been based on this expectation that the Fed may cut rates


David Leduc believes too many investors are on the wrong side of the bond trade. Leduc, chief investment officer of Mellon’s active fixed-income team, blames it on a disconnect between Wall Street and the Federal Reserve. “The market is over-discounting the possibility of Fed cut this year.” “Risk assets, equity markets… as well as corporate bond assets have performed very strongly this year. Part of that performance in our opinion has been based on this expectation that the Fed may cut rates
Wall Street is dangerously overestimating Fed rate cut odds, investor who oversees $135 billion in bonds warns Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-03  Authors: stephanie landsman
Keywords: news, cnbc, companies, dangerously, yearaccording, rate, cut, federal, fed, leduc, oversees, street, odds, assets, investors, futures, investor, bond, wall, warns, overestimating, inflation


Wall Street is dangerously overestimating Fed rate cut odds, investor who oversees $135 billion in bonds warns

David Leduc believes too many investors are on the wrong side of the bond trade.

Leduc, chief investment officer of Mellon’s active fixed-income team, blames it on a disconnect between Wall Street and the Federal Reserve.

“If you look at Fed Funds futures, they’re still pricing in about a 50% chance of a rate cut in December at the end of the year,” he told CNBC’s “Futures Now ” on Thursday. “The market is over-discounting the possibility of Fed cut this year.”

According to Leduc, the sentiment is reflected in how certain assets have been trading.

“Fixed-income investors should be improving the quality of their portfolios,” he said. “Risk assets, equity markets… as well as corporate bond assets have performed very strongly this year. Part of that performance in our opinion has been based on this expectation that the Fed may cut rates and keep monetary policy very, very accommodative. ”

Leduc does not believe the Federal Reserve will make a move this year because of a stronger economic picture and he expects inflation to creep higher.

“While we are not calling for a runaway increase in inflation… we’re likely to see higher cost pressures as we move through the year,” he noted.


Company: cnbc, Activity: cnbc, Date: 2019-05-03  Authors: stephanie landsman
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Jobs surge in April, unemployment rate falls to the lowest since 1969

The U.S. jobs machine kept humming along in April, adding a robust 263,000 new hires while the unemployment rate fell to 3.6%, the lowest in a generation, the Labor Department reported Friday. The unemployment rate for Asians fell sharply, plunging from 3.1% to 2.2%. That brought the labor force participation rate down to 62.8%, exactly where it was a year ago. Those counted as not in the labor force surged by 646,000 to a fresh high of 96.2 million. “Wages may have been slightly tepid this mont


The U.S. jobs machine kept humming along in April, adding a robust 263,000 new hires while the unemployment rate fell to 3.6%, the lowest in a generation, the Labor Department reported Friday. The unemployment rate for Asians fell sharply, plunging from 3.1% to 2.2%. That brought the labor force participation rate down to 62.8%, exactly where it was a year ago. Those counted as not in the labor force surged by 646,000 to a fresh high of 96.2 million. “Wages may have been slightly tepid this mont
Jobs surge in April, unemployment rate falls to the lowest since 1969 Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-03  Authors: jeff cox, yun li
Keywords: news, cnbc, companies, bringing, force, growth, lowest, unemployment, falls, 1969, jobs, rate, total, labor, months, surge, month


Jobs surge in April, unemployment rate falls to the lowest since 1969

The U.S. jobs machine kept humming along in April, adding a robust 263,000 new hires while the unemployment rate fell to 3.6%, the lowest in a generation, the Labor Department reported Friday.

Nonfarm payroll growth easily beat Wall Street expectations of 190,000 and a 3.8% jobless rate.

Average hourly earnings growth held at 3.2% over the past year, a notch below Dow Jones estimates of 3.3%. The monthly gain was 0.2%, below the expected 0.3% increase, bringing the average to $27.77. The average work week also dropped 0.1 hours to 34.4 hours.

Unemployment was last this low in December 1969 when it hit 3.5%. At a time when many economists see a tight labor market, big job growth continues as the economic expansion is just a few months away from being the longest in history.

The unemployment rate for Asians fell sharply, plunging from 3.1% to 2.2%.

While last month’s slump in the jobless rate came with strong increase in hiring, it also was helped along by a sharp decline in the labor force of 490,000. That brought the labor force participation rate down to 62.8%, exactly where it was a year ago.

A broader unemployment gauge that includes those who have quit looking for jobs as well as the underemployed held at 7.3%, where it has been since February.

Those counted as not in the labor force surged by 646,000 to a fresh high of 96.2 million.

“Leaving aside month-to-month fluctuations, the labor market is still very strong, adding almost double the number of workers needed to keep pace with new entrants to the labor force in any given month,” said Eric Winograd, AllianceBernstein’s senior economist. “Wages may have been slightly tepid this month relative to expectations but are still growing at just about the highest rate this cycle, and the unemployment rate is at multi-generational lows.”

The level of unemployed people plunged by 387,000 in April, bringing the total level to 5.8 million. However, the ranks of the employed also declined by 103,000, according to the Labor Department’s household survey.

Professional and business services led job creation with 76,000 new positions. Construction added 33,000, bringing to 256,000 the total new jobs created in the field over the past year.

Health care rose by 27,000, bringing its 12-month total to 404,000, while financial positions increased by 12,000, rounding out an increase of 111,000 in the 12-month period thanks largely to growth in real estate and rental and leasing.

Social assistance increased by 26,000, while manufacturing added 4,000.

Retail, whose fortunes have fluctuated in recent months, saw a loss of 12,000 jobs.

Previous months saw net upward revisions, with February going from a scant 33,000 growth to 56,000, though March’s total was reduced to 189,000 from 196,000, for a net gain of 16,000. Year to date, job gains have averaged 205,000 a month.


Company: cnbc, Activity: cnbc, Date: 2019-05-03  Authors: jeff cox, yun li
Keywords: news, cnbc, companies, bringing, force, growth, lowest, unemployment, falls, 1969, jobs, rate, total, labor, months, surge, month


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Fed’s Clarida says economy is ‘in a very good place’ and backs ‘patient’ approach to rates

Federal Reserve Vice Chairman Richard Clarida said Friday the U.S. economy is strong and interest rate policy is an appropriate place to support growth. Speaking at the Hoover Institution Monetary Policy conference at Stanford University, Clarida endorsed the Fed’s recent policy switch to “patience” in terms of implementing future rate hikes, and to data dependence as opposed to being on a preset course. “The U.S. economy is in a very good place,” the central bank official said in prepared remar


Federal Reserve Vice Chairman Richard Clarida said Friday the U.S. economy is strong and interest rate policy is an appropriate place to support growth. Speaking at the Hoover Institution Monetary Policy conference at Stanford University, Clarida endorsed the Fed’s recent policy switch to “patience” in terms of implementing future rate hikes, and to data dependence as opposed to being on a preset course. “The U.S. economy is in a very good place,” the central bank official said in prepared remar
Fed’s Clarida says economy is ‘in a very good place’ and backs ‘patient’ approach to rates Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-03  Authors: jeff cox
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Fed's Clarida says economy is 'in a very good place' and backs 'patient' approach to rates

Federal Reserve Vice Chairman Richard Clarida said Friday the U.S. economy is strong and interest rate policy is an appropriate place to support growth.

Speaking at the Hoover Institution Monetary Policy conference at Stanford University, Clarida endorsed the Fed’s recent policy switch to “patience” in terms of implementing future rate hikes, and to data dependence as opposed to being on a preset course.

“The U.S. economy is in a very good place,” the central bank official said in prepared remarks. “The unemployment rate is at a 50-year low, real wages are rising in line with productivity, inflationary pressures are muted, and expected inflation is stable.”


Company: cnbc, Activity: cnbc, Date: 2019-05-03  Authors: jeff cox
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Warren Buffett says no textbook could have predicted the strange economy we have today

— The current economic environment is one that no one could have seen coming, Warren Buffett said. The Labor Department said Friday the unemployment rate fell to 3.6% in April, the lowest since 1969. That’s well below the Federal Reserve’s 2% inflation target. “I don’t think our present conditions can exist in terms of fiscal and monetary policy and various other elements across the political landscape,” he said. But I don’t think this can be done without leading to other things.”


— The current economic environment is one that no one could have seen coming, Warren Buffett said. The Labor Department said Friday the unemployment rate fell to 3.6% in April, the lowest since 1969. That’s well below the Federal Reserve’s 2% inflation target. “I don’t think our present conditions can exist in terms of fiscal and monetary policy and various other elements across the political landscape,” he said. But I don’t think this can be done without leading to other things.”
Warren Buffett says no textbook could have predicted the strange economy we have today Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-03  Authors: fred imbert
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Warren Buffett says no textbook could have predicted the strange economy we have today

OMAHA, Neb. — The current economic environment is one that no one could have seen coming, Warren Buffett said.

In an CNBC interview that aired Friday, Buffett noted that unemployment is at generation lows, yet inflation and interest rates are not rising. While at the same time the U.S. government continues to spend more money than it takes in.

“No economics textbook I know that was written in the first couple of thousand years that discussed even the possibility that you could have this sort of situation continue and have all variables stay more or less the same,” Buffett told CNBC’s Becky Quick on Thursday ahead of the annual Berkshire Hathaway shareholders meeting in Omaha on Saturday.

The Labor Department said Friday the unemployment rate fell to 3.6% in April, the lowest since 1969. However, inflation was up just 1.6% on a year-over-year basis in March. That’s well below the Federal Reserve’s 2% inflation target. The overnight interest rate is also below historical levels despite four rate hikes in 2018. The central bank, at its meeting this week, kept rates unchanged at a target range of 2.25% to 2.50%

These conditions are not sustainable for the long term, Buffett said.

“I don’t think our present conditions can exist in terms of fiscal and monetary policy and various other elements across the political landscape,” he said. “I think it will change, I don’t know when, or to what degree. But I don’t think this can be done without leading to other things.”

Buffett, in his pre-shareholders meeting interview that aired on “Squawk Box, ” also revealed that Berkshire Hathaway has been buying shares of Amazon. However, he said Berkshire has not changed its Apple stake.

The “Oracle of Omaha” also spoke out for the first time about how quickly his $10 billion role in the Anadarko saga came together.

The billionaire chairman of Berkshire also weighed in on the challenges bankers face in Washington, saying anyone on Wall Street who takes the vacant Wells Fargo CEO job “would be pinatas from now until the election time.”

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Company: cnbc, Activity: cnbc, Date: 2019-05-03  Authors: fred imbert
Keywords: news, cnbc, companies, inflation, textbook, predicted, meeting, unemployment, warren, dont, omaha, target, today, rate, think, strange, berkshire, buffett, economy


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