Home Logon FTA Investment Managers Blog Subscribe About Us Contact Us

Search by Ticker, Keyword or CUSIP       
 
 

Blog Home
   Brian Wesbury
Chief Economist
 
Bio
X •  LinkedIn
   Bob Stein
Deputy Chief Economist
Bio
X •  LinkedIn
 
  Steady As She Goes
Posted Under: Government • Inflation • Research Reports • Fed Reserve • Interest Rates
Supporting Image for Blog Post

 

If you didn't know there was a Fed meeting today, you didn't miss anything: it made no changes at all to monetary policy.

The only changes to the Fed's statement were an acknowledgement of some economic improvement since the last meeting in early June and an added sentence that the Fed thinks the "path of the economy will depend significantly on the course of the virus." 

Fed Chairman Jerome Powell added some color in the press conference by noting that the pace of the recovery has slowed recently – although he didn't seem concerned about a double-dip recession – that the Fed has no plans to curtail its accommodative stance in any way, and that the Fed views the economic shock as "disinflationary."

Add it all up and it looks like we are eventually headed toward higher inflation.  Broader measures of the money supply, have perked up much more noticeably than after the Subprime Panic in 2008-09.  Meanwhile, we think the Fed would like to see a period of inflation above its target of 2.0% to offset the amount of time inflation has spent below 2.0%.  Expect the Fed to be very slow to raise interest rates relative to economic fundamentals for the next several years.       

Brian S. Wesbury, Chief Economist
Robert Stein, Deputy Chief Economist

Click here for PDF version

Posted on Wednesday, July 29, 2020 @ 3:36 PM • Post Link Print this post Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
 
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
Follow First Trust:  
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
Home |  Important Legal Information |  Privacy Policy |  California Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2024 All rights reserved.