Michael Woolfolk
Michael Woolfolk
below continue data fed labor likely market raising rates remains services support view
February's data support the view that the U.S. labor market remains strong, particularly on the services side, with unemployment solidly below the 5% level. The Fed is likely to continue raising rates for the foreseeable future.
above capacity fed further given high increases last later levels low march raise rates recent release report
Given recent Fed warnings over high levels of capacity utilization and low levels of unemployment, today's report increases the probability that the Fed will raise rates above 5.0% later this year. Last Friday's release of March unemployment further buttresses this view.
below compelling concerned drifted further hike interest levels next rates reason start
Unemployment has drifted further below 5 percent, and at those levels you have to start being concerned about bidding up of wages. There's a compelling reason to hike interest rates at the next meeting.
above argue conditions dollar federal funds growth later rate strong target tight viewed
Strong growth and tight labor-market conditions argue for preemptive tightening that could very well take the federal funds target rate above 5% later this year. This is viewed as a dollar positive.
buy economic investors less low positive rates risks willing
There's a very positive economic story of investors being more willing to take risks and buy equities and less willing to take low rates on bonds.
compelling hike interest next rates reason
There's a compelling reason to hike interest rates at the next meeting.
dollar faster fed giving itself later pace positive raise rates removal room word
The removal of the word 'measured' ... would be positive for the dollar as it suggests that the Fed is giving itself room to raise rates at a faster pace later this year.
continue economic expected fed heads interest political rates report rising risk strength underlying
The monthly GDP report fed into underlying CAD strength. With political risk subsiding, rising interest rates and fundamental economic strength are prompting CAD buying, which is expected to continue through year-end as USD/CAD heads for the 1.10 mark.
durable favorable gains given goods growth interest january market positive rate recent unlikely weigh
Given the recent spate of positive January data, CPI and durable goods are unlikely to disappoint. The USD is positioned to make new gains ... as favorable U.S. growth and interest rate differentials weigh on market sentiment.
bank canadian continues dollar federal hike narrow rates reserve
If the Bank of Canadian continues to hike rates after the Federal Reserve pauses, it will narrow the rate differential between the two. This will make the Canadian dollar more favorable.
backing dollar economic economy likely rate strong
There are strong economic fundamentals backing not only the U.S. economy but the U.S. dollar right now. We are likely to get two more rate hikes.
dollar fed interest looks provide rate supporting time until
Interest rate differentials are supporting the U.S. dollar for the time being. Until the Fed pauses, it looks that's going to provide support for dollar bulls.
continued dollar importance interest labor market rally rate report respect
The dollar rally after the non-farm payrolls report underscores the continued importance of labor market tightness with respect to interest rate expectations.
door fed future hikes left open positive rate
The door will be left open for future rate hikes but the Fed will be increasingly data-dependent. That's positive for the U.S. dollar.