Maury Harris
Maury Harris
Maury Harris is a managing director and chief economist for the Americas for UBS. Harris was named among the 2012 Bloomberg 50 Most Influential people in global finance...
believe fallout fed fixed greater income likely officials signal
Fed officials ... likely anticipated some fallout in fixed income markets. We believe ... that Fed officials wanted to signal a greater probability of tightening in 2004 than had been priced into markets.
bond cost economy employment federal full interest market near pick pressure raise rates reserve short slowing term wage worried
The bond market had been worried that we were near full employment and wage pressure would pick up and that the Federal Reserve would have to raise short term interest rates in response. But now that the all important employment cost index was up just 0.6 percent, the Fed doesn't need to raise short term rates because the economy is slowing down.
begins believe both consistent fed hiring inflation lift require rise solid
We believe that the Fed will require both consistent solid hiring and a rise in inflation before it begins to lift rates.
appear building consumer crude expect fed filter likely next occur pressures price respond until wait
Price pressures appear to be building at crude PPI levels, but the Fed will likely wait to respond until these pressures filter into the consumer price index. We do not expect that to occur until next year.
contained convince easier expect fed gains investors job next rush start
The contained job gains will make it easier for the Fed to convince investors that it will not rush to tighten. We still expect tightening to start only next August.
believe bond crafting fed influenced loss mixed officials perception possibly recent signals
In crafting today's FOMC statement, we believe Fed officials were undoubtedly influenced by the perception that mixed signals from the Fed, and possibly some loss of credibility, accounted for some of the recent surge in bond yields.
claims consistent downward gradually labor late market momentum regain slowly starting trend
Through the volatility, the trend in claims is gradually downward again, consistent with the labor market slowly starting to regain momentum after a setback in late 2002.
above absence both clearly conditions consumers current early gains income notion owed previous remain troubled wartime worry year
Both current conditions and expectations remain above their wartime lows, but the reversal of previous gains undercuts the notion that the slowdown early this year owed only to geopolitical concerns. Consumers are clearly troubled by the absence of new hiring, and worry about income prospects.
adjusting average flat gauge hiring reliable retail sector suggest
Difficulties of seasonally adjusting the retail sector around year-end suggest that the two-month average -- about flat -- is a more reliable gauge of hiring trends.
above annual assumed estimate growth percent quarter raised rate rose third total
We now estimate that total real consumption rose at a 6.5-percent annual rate in the third quarter as a whole, above the 5.5 percent we assumed when we raised our estimate for total real GDP growth to 5.5 percent from 4.5 percent.
add bond initial market reaction statement
Today's FOMC statement did not add any new specificity or much elaboration, and the initial reaction in the bond market has been limited.
accounting add extra percent point strength total
With consumption accounting for about 70 percent of GDP, the extra strength should add about 0.7 point to total GDP growth.
additional cooling declines existing expect home housing including moderation overall recent result sales slowing
The recent declines in existing home sales corroborate the slowing in other housing-related data. We expect additional slowing in the housing market, including prices, in 2006. In turn, the cooling will probably result in a moderation in overall growth.
bond market movement moving stocks
The bond market has been moving on two things today: the movement of stocks and this speculation about the yuan.