We haven’t even gotten to New Year’s Day 2020 and already President Donald Trump is again banging the drum for interest rate cuts from the Federal Reserve Board. Well, of course, it’s not like he has other stuff to do, like ward off impeachment.
And already Fed policymaking officials are defending the idea that the 2019 three rate cuts already put into force this year are enough to support the economy.
Haven’t we seen this movie before?
In several recent media interviews, Fed policy officials, such as James Bullard, president of the St. Louis Fed, went out of their way to emphasize two things: the Fed is happy where rates are and that it will take a lot in the way of inflation to change the current policy. The presidents of the Dallas and Boston Fed banks, in separate appearances Tuesday in New York, were happy with the current level of the Fed futures rate and upbeat about the U.S. economy.
Monetary policy is in a good place is the watchword from the Fed. Expect no change.With the Fed quiescent, I turn to other central bank news, where the action is easing, as my colleague Tom Lee notes in his outlook, page 3. The Bank of Mexico, for example, reduced rates for the fourth consecutive time since August, hoping to support a faltering economy while inflation...