Peter Kretzmer
Peter Kretzmer
concerned fed impact inflation markets surprised thinking
The thinking that has surprised us has been that the markets and the Fed have been more concerned about the impact on inflation expectations than they've been about real growth.
basis buck built continues fed move points
It assures that the Fed continues to not buck what was built into the futures contract, and will move by 25 basis points in September.
assume direct economic events fed gulf late pauses rather related response slowing year
If the Fed pauses late in the year, as we now assume in December, its response will be related to economic fundamentals, with GDP slowing late in the year rather than a direct 'emergency' response to events on the Gulf Coast.
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On balance, recent inflation reports have shown the Fed evidence of pipeline commodity price pressures but with little impact on consumer inflation trends,
chances crude fed further gradual hurt line means oil prices raising
If crude oil prices keep on rising, the chances that consumption is going to be hurt further down the line rises. That means the Fed could be more gradual in raising rates.
demand higher home interest likely ownership properties push rates rising stronger
With interest rates rising and demand for new home ownership slowing, it is likely that stronger demand for rental properties will push rental rates up at a higher pace.
commodity inflation prices since
There hasn't been a lot of correlation between commodity prices and inflation since 1990.
consumer happen increase vaguely
It's only vaguely predictive of what will happen with month-to-month consumer spending. It did increase dramatically in March, so some drop-back is not unexpected.
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The numbers are a little better than we expected. Still, these things bounce around, and I think we'll probably see the unemployment figure break 4.5 percent next month.
numbers
The numbers are a little better than we expected,
bit building component consistent continues growth increase indicative maybe moderate month number obvious pressures price sector
It's a number consistent with a manufacturing sector that is strong, it strengthened a little bit in the month and I think growth continues to be moderate in the manufacturing sector, price pressures while still not obvious maybe are building a little bit you can see an increase in the price component to 55.1 that's indicative of some price pressure.
bullish coming data feeling number overall trade weaker
The overall weaker GDP number coming from the trade data does give you a more bullish feeling on Treasuries,
meaning worried
We don't know if there is any meaning to the slowdown in these other categories. I wouldn't be too worried about it.
beginning consumer decline levels longer run sales spending toward vehicle
As vehicle sales decline toward longer run levels beginning in August, consumer spending will slow.