Jonathan's Feed
Aug 24, 2015

Market turmoil threatens Fed’s rate hike plans

WASHINGTON/NEW YORK (Reuters) – Turmoil in world financial markets and growing fears of a China-led global economic slowdown threaten to derail the Federal Reserve’s plans to start raising rates from near zero, making the chances of a September lift-off look increasingly remote.

A near 9-percent dive in Chinese shares on Monday triggered sharp sell-offs in Asia and Europe, wild swings and losses on Wall Street, and knocked crude prices to new multi-year lows.

Aug 12, 2015

Yuan move probably appropriate if China slowing: Fed’s Dudley

By Jonathan Spicer

(Reuters) – An adjustment to China’s currency is probably appropriate if the Chinese economy is weaker than authorities there expected, a top Federal Reserve official said on Wednesday in the U.S. central bank’s first public response to the devaluation of the yuan.

“Obviously if the Chinese economy is weaker than maybe what the Chinese authorities anticipated, it’s probably not inappropriate for the currency to adjust in consequence to that weakness,” said New York Fed President William Dudley.

Aug 11, 2015

Eyes on U.S. economy, Fed likely unmoved by China devaluation

NEW YORK (Reuters) – China’s currency devaluation on Tuesday is unlikely to distract the U.S. Federal Reserve from a domestic economy that appears increasingly ready for higher interest rates.

The U.S. central bank will hope that the surprise move is not the beginning of a series of competitive devaluations that could send the dollar much higher than its slight rise on Tuesday, weakening already soft U.S. inflation, economists and Fed watchers said.

Aug 7, 2015

Labor market swagger has Fed warming to September rate hike

NEW YORK/WASHINGTON, Aug 7 (Reuters) – Federal Reserve
officials are growing more comfortable with the idea of
beginning to tighten policy next month, as the U.S. labor
market’s improvement makes it harder for even dovish officials
to justify historically low interest rates.

Data on Friday pointing to a firming economy and job market,
as well as comments from Fed officials, suggest weak U.S.
inflation and outside risks like China’s recent stock market
crash are unlikely to dissuade the central bank from raising
rates at a mid-September meeting.

Aug 6, 2015

Insight – U.S. companies may be hiring but lid on wages, investment hits productivity

BRIDGEPORT, NJ (Reuters) – As the Federal Reserve puzzles over what is holding back U.S. wages and productivity six years into the economic recovery, a pasta sauce company in New Jersey may offer some answers.

    Chelten House Products makes private-label sauces and dressings for high-end grocers such as Whole Foods (WFM.O: Quote, Profile, Research), Trader Joe’s and Kroger (KR.N: Quote, Profile, Research), and has doubled its workforce to 300 over the past five years to keep up with a booming organic food market.

Aug 6, 2015

US companies may be hiring but lid on wages, investment hits productivity

BRIDGEPORT, NJ, Aug 6 (Reuters) – As the Federal Reserve
puzzles over what is holding back U.S. wages and productivity
six years into the economic recovery, a pasta sauce company in
New Jersey may offer some answers.

Chelten House Products makes private-label sauces and
dressings for high-end grocers such as Whole Foods,
Trader Joe’s and Kroger, and has doubled its workforce to
300 over the past five years to keep up with a booming organic
food market.

Aug 5, 2015

Fed not yet decided whether to hike rates in Sept -Powell

NEW YORK, Aug 5 (Reuters) – Federal Reserve policymakers
have not yet decided whether to raise interest rates next month,
an influential governor at the U.S. central bank said on
Wednesday, appearing to push back on more hawkish comments the
day before by a fellow U.S. official.

Fed Governor Jerome Powell said he and others on the
policy-making Federal Open Market Committee will, between now
and the closely watched Sept. 16-17 meeting, analyze data on the
labor market in particular before making that decision.

Jul 31, 2015

Who needs the Fed? The rate hike cometh on its own

NEW YORK, July 31 (Reuters) – As traders, market pundits and
economists jaw over whether the Federal Reserve this year will
lift its benchmark lending rate for the first time in almost a
decade, several corners of the U.S. bond market aren’t waiting
around.

A wide range of short-term interest rates, which tend to be
the most sensitive to Fed policy expectations, have been quietly
grinding higher for weeks, or in some cases much longer. Several
have even surpassed their levels from two years ago during the
bond market’s “taper tantrum,” when prices tanked and yields
shot up as the Fed pondered whether to halt its massive
asset-purchase program.

Jul 21, 2015

Fed takes tough stance on bond liquidity, downplays market fears

NEW YORK/WASHINGTON, July 21 (Reuters) – While Wall Street
frets over the ability of bond markets to absorb an approaching
interest rate rise, the U.S. Federal Reserve has a message for
the industry: deal with it.

The financial industry worries that when the Fed’s
tightening plans take hold, a sell-off in the massive U.S. bond
market could ensue, and be exacerbated by a lack of bank buyers
willing to jump in.

Jul 15, 2015

Time to withdraw ‘emergency’ U.S. accommodation: Fed’s Mester

By Jonathan Spicer

(Reuters) – The Federal Reserve can start to withdraw its “emergency” policy accommodation now that the labor market is largely healed, and given the U.S. economy will likely dodge fallout from Greece’s debt crisis, a top Fed official said on Wednesday.

In a speech, Cleveland Fed President Loretta Mester bolstered the argument that she and other hawkish U.S. central bankers have been making to finally begin lifting interest rates from near zero.