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☆ Traders got their big-rate-cut wish and markets still couldn't rally
▼ + stars: | 2024-09-18 | by ( Sarah Min | ) www.cnbc.com time to read: +2 min

Wall Street got the big rate cut it wanted, but markets failed to sustain a rally. The Federal Reserve on Wednesday cut its key overnight lending rate by a half percentage point . Ryan Sweet, chief U.S. economist at Oxford Economics, noted that the half-point cut suggests slowing growth is increasingly concerning Fed policy makers. "The Fed is likely worried that labor demand would weaken more, causing additional stress points in the labor market." "A larger cut probably was not needed out of the gate, but that should support risk-on asset allocation."

Persons: Ryan Sweet, Sweet, Nancy Tengler, Tengler, Scott Helfstein, Jeff Cox, Michelle Fox Organizations: Federal Reserve, Oxford Economics, Fed, Global

☆ CNBC Daily Open: Hoping for a half-point cut
▼ + stars: | 2024-09-18 | by ( Yeo Boon Ping | ) www.cnbc.com time to read: +2 min

Anna Moneymaker | Getty Images News | Getty ImagesThis report is from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Without any warning signs flashing red, it's difficult for the Fed to justify lowering rates by more than a quarter point. That's why some economists and analysts hope the Fed will cut by half a point. "But I suspect they'll cut 25," Zandi added.

Persons: Anna Moneymaker, Mark Zandi, they'll, Zandi, Hope, Jeff Cox, Hakyung Kim, Samantha Subin Organizations: Federal Reserve, Getty, CNBC, Dow, Moody's Locations: Washington , DC, U.S

☆ CNBC Daily Open: Hoping for a 50-basis-point cut
▼ + stars: | 2024-09-18 | by ( Yeo Boon Ping | ) www.cnbc.com time to read: +2 min

Persons: Anna Moneymaker, Mark Zandi, they'll, Zandi, Hope, Jeff Cox, Hakyung Kim, Samantha Subin Organizations: Federal Reserve, Getty, CNBC, Dow, Moody's Locations: Washington , DC, U.S

☆ The Fed's biggest interest rate call in years happens Wednesday. Here's what to expect
▼ + stars: | 2024-09-17 | by ( Jeff Cox | ) www.cnbc.com time to read: +7 min

The meeting wraps up Wednesday afternoon, with the release of the Fed's rate decision coming at 2 p.m. "I hope they cut 50 basis points, but I suspect they'll cut 25. Here's a breakdown of what's on tap:The rate waitThe FOMC has been holding its benchmark fed funds rate in a range between 5.25%-5.5% since it last hiked in July 2023. The 'dot plot'Perhaps just as important as the rate cut will be the signals meeting participants send about where they expect rates to go from here. In June, FOMC members penciled in just one rate cut through the end of the year.

Persons: Jerome Powell, William McChesney Martin Jr, Andrew Harnik, they'll, Mark Zandi, that's, Tom Simons, Zandi, Robert Kaplan, There'll, Seema Shah, FOMC, Moody's, Goldman Sachs, Powell presser, Goldman, Simons Organizations: Federal Reserve, Committee, Moody's, Wall, Jefferies, Dallas Fed, CNBC, Asset Management Locations: Washington , DC

☆ Former Dallas Fed President Kaplan advocates for a half-point interest rate cut
▼ + stars: | 2024-09-17 | by ( Jeff Cox | ) www.cnbc.com time to read: +1 min

If Robert Kaplan still had a say in the matter, he'd be pushing for a half percentage point interest rate reduction at this week's Federal Reserve meeting. The former Dallas Fed president told CNBC on Tuesday that making the bolder move of 50 basis points would better position policymakers heading into the latter part of the year and the economic challenges ahead. "If I were sitting at the table, I would be advocating for 50 in this meeting," Kaplan said during a "Squawk Box" interview. One basis point equals 0.01%. Kaplan ran the Dallas Fed from 2015-21 and is now a managing director at Goldman Sachs.

Persons: Robert Kaplan, Kaplan, Jerome Powell, Jay Powell, Goldman Sachs Organizations: Dallas Fed, CNBC, Federal

☆ The Fed has the proof it wants that inflation is slowing, but the next move is still up in the air
▼ + stars: | 2024-09-14 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

A week's worth of inflation data showed that price pressures have eased substantially since their meteoric rise in 2021-22. "We got two more months of good inflation data" since the last Fed meeting, Claudia Sahm, chief economist for New Century Advisors, said in a CNBC interview Friday. Futures markets for most of the past week had lasered in on a quarter percentage point, or 25 basis point, rate cut. The inflation data "on its own would have gotten us 25 next week, as it should, and will get us a whole string of cuts after that," she said. [Fed officials] need to kind of clean it up, do a 50 basis point cut and then be ready to do more."

Persons: Jerome Powell, Claudia Sahm, Sahm Organizations: Banking, Housing, Urban, Capitol, Federal Reserve, Federal, New Century Advisors, CNBC, Fed Locations: Washington ,

☆ Top economist Ed Hyman no longer sees recession coming, flips GDP forecast to positive
▼ + stars: | 2024-09-13 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

Economists Ed Hyman is backing off his call for a hard landing, even though he still sees the potential for a recession ahead. "History and experience say to stick with a hard landing outlook," he said in a client note Thursday. "However, the hard math that our team has reviewed says flip to a soft landing outlook. "In our view, arguments for a hard landing are still persuasive," Hyman wrote. "So this flip could be a mistake," Hyman wrote.

Persons: Ed Hyman, Hyman, Ally, Russell Hutchinson, it's Organizations: ISI, Atlanta Federal Reserve, JPMorgan Chase, Federal Reserve Locations: New York

☆ CNBC Daily Open: All key data is in — and it's made the Fed's policy path more uncertain
▼ + stars: | 2024-09-13 | by ( Yeo Boon Ping | ) www.cnbc.com time to read: +2 min

CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Last Friday, the August employment report showed the number of jobs added was lower than expected but higher than the previous month. Wednesday's CPI report showed the lowest 12-month inflation rate in two-and-a-half years. In short, the data hasn't cleared up whether the Fed will cut by 25 or 50 basis points. They think there's a 57% chance of a 25 point cut and 43% of a 50 point one, according to the CME FedWatch tool.

Persons: Stefani Reynolds, We've, Wednesday's, Jeff Cox, Pia Singh, Sarah Min Organizations: Eccles Federal Reserve, Bloomberg, CNBC, U.S . Federal Reserve, PPI Locations: Washington ,

☆ Interest payments on the national debt top $1 trillion as deficit swells
▼ + stars: | 2024-09-12 | by ( Jeff Cox | ) www.cnbc.com time to read: +1 min

The U.S. government for the first time has spent more than $1 trillion this year on interest payments for its $35.3 trillion national debt, the Treasury Department reported Thursday. Subtracting the interest the government earns on its investments, net interest payments have totaled $843 billion, higher than any other category except Social Security and Medicare. The jump in debt service costs came as the U.S. budget deficit surged in August, edging closer to $2 trillion for the full year. The Fed is widely expected to lower rates next week, but just by a quarter percentage point. The benchmark 10-year note last yielded about 3.7%, down more than three-quarters of a percentage point since early July.

Organizations: U.S . Treasury, Treasury Department, Federal Reserve, Social Security Locations: Washington , U.S, U.S

☆ Wholesale prices rose 0.2% in August, in line with expectations
▼ + stars: | 2024-09-12 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

Wholesale prices rose in August about in line with expectations, the final inflation data point as the Federal Reserve gets set to lower interest rates. The core increase was the same when excluding trade services. On a 12-month basis, headline PPI rose 1.7%. On the PPI measure, services prices pushed much of the gain, with a 0.4% monthly increase driven by a rise in services less trade, transportation and warehousing. The release comes a day after the BLS reported that consumer prices rose 0.2% on the month in line with expectations.

Persons: Dow Jones Organizations: Federal Reserve, of Labor Statistics, PPI, Labor Department, BLS

☆ CNBC Daily Open: Looking past sticky core inflation
▼ + stars: | 2024-09-12 | by ( Yeo Boon Ping | ) www.cnbc.com time to read: +2 min

Spencer Platt | Getty Images News | Getty ImagesThis report is from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. The S&P 500 climbed 1.07%, the Dow Jones Industrial Average added 0.31% and the Nasdaq Composite shot up 2.17%. Core inflation, to which the Fed pays more attention because it more accurately reflects price movements, came in a bit higher than expected for the month. Core inflation was higher than the headline number because food and energy prices are stripped out from the former.

Persons: Spencer Platt, –, Jeff Cox, Pia Singh, Lisa Kailai Han Organizations: Getty, CNBC, Dow Jones, Nasdaq, Fed, of Labor Statistics, Nvidia, Reuters, U.S . House Locations: Brooklyn, New York City, U.S, Saudi Arabia

☆ Markets get nervous over high core inflation and see the Fed cutting slowly
▼ + stars: | 2024-09-11 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

Stubbornly high core inflation virtually cemented the likelihood of a quarter percentage point cut from the Federal Reserve, which historically has avoided larger moves unless absolutely necessary. Shelter inflation is putting a floor under the CPI and likely keeping the Fed from reducing interest rates by more 25 basis points. "History back to 1990 supports the idea that an initial Fed rate cut of 50 basis points signals an imminent recession (2001 and 2007). "Their first cut will almost certainly be 25 basis points," Colas said. But the Fed, which targets inflation at 2%, prefers core readings as a better longer-term gauge for inflation.

Persons: Dow Jones, —, Nick Colas, Jerome Powell, Colas, That's Organizations: Federal Reserve, Labor Department, CPI, Fed, Traders, Open Market, PCE

☆ Consumer prices rose 0.2% in August as annual inflation rate hits lowest since early 2021
▼ + stars: | 2024-09-11 | by ( Jeff Cox | ) www.cnbc.com time to read: 1 min

Prices increased as expected in August while the annual inflation rate declined to its lowest level since February 2021, according to a Labor Department report Wednesday that sets the stage for an expected quarter percentage point rate cut from the Federal Reserve in a week. The consumer price index, a broad measure of goods and services costs across the U.S. economy, increased 0.2% for the month, in line with the Dow Jones consensus, the Bureau of Labor Statistics reported. That put the 12-month inflation rate at 2.5%, down 0.4 percentage point from the July level and compared to the estimate for 2.6%.

Persons: Dow Jones Organizations: Labor Department, Federal Reserve, of Labor Statistics Locations: U.S

☆ Two key inflation reports this week will help decide the size of the Fed's interest rate cut
▼ + stars: | 2024-09-10 | by ( Jeff Cox | ) www.cnbc.com time to read: +1 min

The Federal Reserve gets its last look this week at inflation readings before it will determine the size of a widely expected interest rate cut soon. On Wednesday, the Labor Department's Bureau of Labor Statistics will release its consumer price index report for August. With the issue virtually settled over whether the Fed is going to cut rates when it wraps up the next policy meeting Sept. 18, the only question is by how much. "Inflation data has taken a backseat to labor market data in terms of influence on Fed policy," Citigroup economist Veronica Clark said in a note. "But with markets — and likely Fed officials themselves – split on the appropriate size of the first rate cut on September 18, August CPI data could remain an important factor in the upcoming decision."

Persons: Veronica Clark, Dow Organizations: Federal Reserve, Labor Department's Bureau of Labor Statistics, BLS, CPI, Citigroup, Fed, PPI

☆ Fed Governor Waller backs interest rate cut at September meeting, open to larger move
▼ + stars: | 2024-09-06 | by ( Jeff Cox | Jeff Cox Is A Finance Editor With Cnbc.Com Where He Covers All Aspects Of The Markets | Monitors Coverage Of The Financial Markets | ) www.nbcnews.com time to read: +2 min

Federal Reserve Governor Christopher Waller on Friday backed an interest rate cut at the upcoming central bank policy meeting in less than two weeks, and indicated he’d be open to a substantial reduction if necessary. Other policymakers recently have advocated easing policy soon, but this is one of the clearest indications it will happen at the Sept. 17-18 Federal Open Market Committee meeting. “Determining the pace of rate cuts and ultimately the total reduction in the policy rate are decisions that lie in the future,” Waller added. With inflation and employment near our longer-run goals and the labor market moderating, it is likely that a series of reductions will be appropriate,” he said. Futures market pricing following the jobs report tilted toward a greater likelihood of a quarter percentage point rate reduction this month.

Persons: Christopher Waller, ” Waller, Waller, verbiage, Jerome Powell, —, nonfarm, Dow Jones, ” Organizations: Federal, Council, Foreign Relations, Labor Department, Dow Locations: New York

☆ August payrolls grew by a less-than-expected 142,000, but unemployment rate ticked down to 4.2%
▼ + stars: | 2024-09-06 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

At the same time, the unemployment rate ticked down to 4.2%, as expected. The labor force expanded by 120,000 for the month, helping push the jobless level down by 0.1 percentage point, though the labor force participation rate held at 62.7%. The household survey, which is used to calculate the unemployment rate and is often more volatile than the survey of establishments, showed employment growth of 168,000. Markets showed little initial reaction to the data, with stock futures holding negative and Treasury yields also lower. While the August numbers were close to expectations, the previous two months saw substantial downward revisions.

Persons: Nonfarm, Dow Jones, Dan North Organizations: Federal Reserve, Labor Department's Bureau of Labor Statistics, BLS, North America, Allianz Trade, Manufacturing Locations: U.S, Dow

☆ Layoffs jump in August while hiring in 2024 is at a historic low, Challenger report shows
▼ + stars: | 2024-09-05 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

Layoffs soared in August, hitting their highest total for the month in 15 years, while year-to-date hiring reached a historic low, outplacement firm Challenger, Gray & Christmas reported Thursday. Announced job cuts totaled 75,891 for the month, lurching 193% higher than July. "August's surge in job cuts reflects growing economic uncertainty and shifting market dynamics," said Andrew Challenger, the firm's senior vice president. To be sure, the Challenger layoffs data is somewhat out of sync with government reports, which show that initial claims for unemployment benefits have been slightly elevated in recent weeks but not reflective of a major escalation. Companies announcing job cuts most often cited cost-cutting and economic conditions as the reasons, though artificial intelligence also was listed for the first time since April.

Persons: Andrew Challenger Organizations: Challenger, Companies Locations: U.S

☆ August private payrolls rose by 99,000, smallest gain since 2021 and far below estimates, ADP says
▼ + stars: | 2024-09-05 | by ( Jeff Cox | ) www.cnbc.com time to read: +3 min

Private sector payrolls grew at the weakest pace in more than 3½ years in August, providing yet another sign of a deteriorating labor market, according to ADP. August was the weakest month for job growth since January 2021, according to data from the payrolls processing firm. Still, the ADP data showed that while hiring has slowed considerably, only a few sectors reported actual job losses. Annual pay increased 4.8% for those who stayed in their jobs, about the same level as July, according to ADP. The ADP count now tees up the more closely watched nonfarm payrolls report, which the Bureau of Labor Statistics will release Friday.

Persons: payrolls, Nela Richardson Organizations: ADP . Companies, Dow, Labor Department, ADP, of Labor Statistics, BLS, Federal

☆ Friday's jobs report for August is going to be huge. Here's what to expect
▼ + stars: | 2024-09-05 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

The Wall Street consensus is for nonfarm payrolls growth of 161,000 for August and a slight decline in the unemployment rate to 4.2%, according to Dow Jones. In turn, markets are certain the Fed will start lowering interest rates in a couple weeks, with the possibility of a jumbo cut depending on what Friday's report shows. "What the Fed is going to do in response, how are they going to adjust rates, that's why we are having this conversation." While job growth has been tailing off through much of 2024, the deceleration hit home for the market with a July report that showed payroll growth of just 114,000. The latest bad news came Thursday when payrolls processing firm ADP put August private job growth at just 99,000, the smallest gain since January 2021.

Persons: Dow Jones, Giacomo Santangelo Organizations: Labor Department, Federal Reserve, Fed

☆ Atlanta Fed President Bostic says officials can't wait for inflation to hit 2% before cutting
▼ + stars: | 2024-09-04 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

Atlanta Federal Reserve President Raphael Bostic signaled Wednesday that he is ready to start lowering interest rates even though inflation is still running above the central bank's target. The Fed's preferred measure showed inflation running at a 2.5% rate in July, and just a slightly higher 2.6% core rate when excluding food and energy. His comments also come two days before what is expected to be a pivotal nonfarm payrolls report as most economists see the labor market losing momentum. However, the data and our grassroots feedback describe an economy and labor market losing momentum," he said. Indeed, he cited multiple factors indicating that inflation is progressing convincingly back to the Fed's target as the labor market moderates.

Persons: Raphael Bostic, Bostic Organizations: Atlanta Federal Reserve, Atlanta Fed's Locations: Atlanta

☆ Job openings fell more than expected in July in another sign of labor market softening
▼ + stars: | 2024-09-04 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

Job openings slumped to their lowest level in 3½ years in July, the Labor Department reported Wednesday in another sign of slack in the labor market. "The labor market is no longer cooling down to its pre-pandemic temperature, it's dropped past it," said Nick Bunker, head of economic research at the Indeed Hiring Lab. "Nobody, and certainly not policymakers at the Federal Reserve, should want the labor market to get any cooler at this point." While the job openings level declined, layoffs increased to 1.76 million, up 202,000 from June. "The still low level of layoffs and tick up in hires suggests the labor market is not cracking.

Persons: Dow Jones, it's, Nick Bunker, Krishna Guha, nonfarm Organizations: Labor Department, Labor, Survey, Federal Reserve, Global Policy, Central Bank, Evercore ISI

☆ Bond market 'yield curve' returns to normal from inverted state that had raised recession fears
▼ + stars: | 2024-09-04 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

An inverted yield curve, in which the nearer-duration yield is higher, has signaled most recessions since World War II. However, a normalization of the curve does not necessary signal good times ahead. In fact, the curve usually does revert before a recession hits, meaning the U.S. could still be in for some rough economic waters ahead. Job openings had exceeded labor supply by more than 2 to 1 at one point, aggravating inflation that had been at its highest level in more than 40 years. That part of the curve is still steeply inverted, with the difference now at more than 1.3 percentage points.

Persons: Raphael Bostic, Quincy Krosby Organizations: CME Group, Atlanta Fed, LPL, Labor Department, Atlanta Federal Reserve Locations: Chicago, U.S

☆ Weak manufacturing measures raise specter of U.S. economic slowdown
▼ + stars: | 2024-09-03 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

U.S. factories remained in slowdown mode in August, fueling fears about where the economy is headed, according to separate manufacturing gauges. Demand continues to be weak, output declined, and inputs stayed accommodative," said Timothy Fiore, chair of the ISM Manufacturing Business Survey Committee. While the index level suggests contraction in the manufacturing sector, Fiore pointed out that any reading above 42.5% generally points to expansion across the broader economy. Another weak economic reading raises the probability the Federal Reserve will be cutting interest rates by at least a quarter percentage point later this month. "A further downward lurch in the PMI points to the manufacturing sector acting as an increased drag on the economy midway through the third quarter.

Persons: Dow Jones, Timothy Fiore, Fiore, Stocks, Chris Williamson Organizations: Institute for Supply Management, Dow, ISM Manufacturing Business Survey, Dow Jones, Federal Reserve, PMI, P Global Market Intelligence Locations: U.S

☆ The Fed’s favorite inflation indicator increased 0.2% in July, as expected
▼ + stars: | 2024-08-30 | by ( Jeff Cox | ) www.cnbc.com time to read: +3 min

Excluding volatile food and energy prices, core PCE also increased 0.2% for the month but was up 2.6% from a year ago. Core prices less housing, another key metric for the Fed, increased just 0.1% on the month. Elsewhere in the report, the department's Bureau of Economic Analysis said personal income increased 0.3%, slightly higher than the 0.2% estimate, while consumer spending rose 0.5%, in line with the forecast. Markets reacted little to the news, with equity futures pointing to a slightly higher open on Wall Street and Treasury yields higher as well. In recent days, policymakers such as Chair Jerome Powell have expressed confidence that inflation is progressing back to the Fed's 2% goal.

Persons: Dow, Joseph Brusuelas, Jerome Powell Organizations: Federal Reserve, Commerce Department, Dow Jones, Fed, department's, BEA, Treasury, RSM

☆ The Fed's preferred inflation indicator is out Friday. Here's what to expect
▼ + stars: | 2024-08-29 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

While the Fed uses a whole dashboard of indicators to measure inflation, the PCE index is its go-to data point and its sole forecasting tool when members release their quarterly projections. Policymakers especially hone in on the core PCE measure, which excludes food and energy, when making interest rate decisions. "To me, it's going to be just one more piece of evidence to confirm that the Fed is seeing sustainable inflation readings at a sustainable pace," said Beth Ann Bovino, chief economist at U.S. Bank. Any slight upticks are "really just base-effect kinds of things that aren't going to change the Fed's view." Fed officials aren't declaring victory over inflation yet, though recent statements indicate a more positive outlook.

Persons: Dow Jones, Beth Ann Bovino, aren't Organizations: Federal, Commerce Department, Fed, Labor, Dow, U.S . Bank

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