Uncertainty has become an ongoing theme in markets, economies, and communities everywhere, and in this environment, PIMCO investment professionals gathered – virtually, once again – for our recent Cyclical Forum.
The Federal Reserve pulls forward rate hike expectations and doubles the pace of tapering in an effort to provide more flexibility to react in 2022.
The risks of continued elevated inflation likely have the U.S. Federal Reserve considering material changes to its policy path.
Stronger-than-expected U.S. inflation data in October may prompt the Federal Reserve to consider tapering faster and hiking sooner.
The Federal Reserve navigated its tapering announcement without much market volatility, but faces the challenge of managing rate expectations amid elevated inflation risks.
Elevated risks to inflation expectations appear to have prompted Federal Reserve officials to revise their policy rate hike projections higher.
The Fed stopped short of providing “advance notice,” but a December tapering announcement remains likely.
Over the past few months, economic recoveries have been uneven across regions and sectors.
We believe the U.S. is undergoing a large price-level adjustment, not shifting to a persistently higher inflation regime.
As regulators push to transition away from Libor, sales of Treasuries linked to the successor rate could boost the new benchmark’s credibility and expand nascent markets for related debt and derivatives.
As expected, the Federal Open Market Committee (FOMC) announced no changes to its administered rates following its April meeting, and Federal Reserve Chair Jerome Powell did not provide new information about the Fed’s bond-buying programs.
On April 21 the Governing Council of the Bank of Canada (BoC) will meet to discuss monetary policy.
The Federal Reserve on 19 March announced that the temporary changes to its supplemental leverage ratio, or SLR, will expire as scheduled on 31 March.
Following its March meeting, the Federal Open Market Committee (FOMC) released a statement and summary of economic projections (SEP).
As the latest COVID-19 relief bill winds through the U.S. Congress, some economists have been warning that too much stimulus could lead to the economy overheating
One year since the inception of one of the most severe recessions in modern history, women’s engagement in the labor force is crucial to the economic recovery.
A large fiscal package geared toward pandemic relief will likely boost U.S. growth even further in 2021, but long-term inflationary risks are still balanced.
A clear communication strategy is crucial to managing market expectations around changes in Federal Reserve asset purchases and interest rate policy.
With a narrowly Democratic Congress, U.S. fiscal spending is likely to increase on economic relief from the pandemic, infrastructure, and healthcare, boosting the economic rebound.
Rising prices in July have led PIMCO to raise its core inflation forecast for 2020, but not 2021.
The Federal Reserve wants financial conditions to remain accommodative as it looks to support the U.S. recovery.
European measures applied to mitigate the effects of the pandemic have contained the unemployment rate in Europe more than in the U.S. While recognizing economic risks from the rising number of COVID-19 cases in the U.S., our forecast sees this success ratio reversing before the end of the year.
We expect more stimulus, both monetary and fiscal, will be necessary to support the recovery amid the renewed COVID-19 outbreak.
We expect the Federal Reserve will continue to conduct asset purchases at its current pace through year-end, and eventually commit to keeping interest rates on hold through 2022. This should help ensure easy financial conditions and support the economic recovery.
The U.S. political focus has shifted to the reopening of the economy.
Over the next several quarters, monetary conditions will likely be set not only by Fed balance sheet policies, but also by the expected path of interest rates.
The U.S. labor market disruption is the worst the country has experienced in recent memory, suggesting that the decline in overall activity could also be much more severe.
The Fed has moved aggressively to stabilize core assets, including mortgages. Yet several market indicators are still concerning.
The $2.2 trillion stimulus is the biggest ever, but Congress will likely be forced to do even more.
The Fed’s aggressive support may help keep markets functioning, hasten recovery and avoid longer-term damage.
A bolder fiscal response to the rapidly spreading coronavirus has become an economic and political imperative.
The Fed announced two actions Thursday in response to stress in the market for U.S. Treasuries.
Fed rate cuts may be less effective at boosting the economy or markets as societies grapple with the spread of COVID-19, but other policy measures may help.
The Federal Reserve wants to avoid a crisis of confidence.
As the Fed winds down its T-bill and repo programs, we don’t anticipate market volatility to emerge – at least not as a result of the Fed’s actions.
In its December forecasts, the Federal Reserve estimates that the policy rate will hold steady through 2020. Will economic and trade developments change that view?
Fed Chair Powell signaled that another “insurance” rate cut is unlikely. Instead, further rate cuts are contingent on a more material deterioration in the economic outlook.
We think there are policy tools in the Fed arsenal that wouldn’t materially alter the soundness of the banking system but could allow cash to move more freely.
Weakness in the U.S. economy leaves it vulnerable to shocks. We think the Fed will respond with additional easing this year.
The risk of recession has risen, but it’s not a foregone conclusion.
We think the Federal Reserve will look past stronger-than-expected consumer price increases in June and July.
We find the Fed’s statement clear, and we expect another rate cut as soon as September with possible additional cuts thereafter.
The market consequences of direct intervention by the U.S. could be substantial and thus bear consideration.
The Federal Reserve is poised to cut interest rates at its July meeting. But how much will it cut?
June inflation may have been boosted by the recent increase in import tariffs, while inflationary pressures from rising wages and tight labor markets remain notably subdued.
The tone of the FOMC statement and press conference was a notable shift from the May meeting, given uncertainty around the economic outlook.
We don’t expect a Fed rate cut in June, but if downside risks to the economy escalate, a 50 basis point cut in July is possible, in our view.
New U.S. tariffs on Mexico would add to the direct economic costs of the string of tariff hikes enacted during this administration.
With the U.S. and China raising tariffs on each other’s goods, we may be entering a prolonged period of trade tension.
