There are a ton of so called Macro experts out there with an opinion on the upcoming Federal Reserve dot plot. Almost none of these are surgically formed Heres is a surgical approach to it 6 members wrote down 3 2024 dots in Dec SEP. I think these members are: Daly, Barr,

One of the recently loosely formed macro narratives is that given the stock market rally and its wealth creation, consumer spending will be “perennially” strong. I wrote about wealth effect on consumer spending to refute the idea that the consumer was about to fall into a

Results of our March shadow survey indicate market participants expect the median rate path to be unchg'd from Dec but a sizeable minority (28%) thinks the 2024 "dot" could be revised higher. The Fed's 2024 core PCE inflation projection lies at the heart of the disagreement. 1/6

Detroit Shelter CPI was responsible for 1.8 bps of March inflation or about 30% of the core inflation miss 💀

Bumpy road.. perspective is needed or a few years living in an EM country. DM folks are not familiar with price propagation in normal times so they confuse bumpy road with inflation broadening Daniel S. Loeb another one for #UncleLarry

Continuing with the AI generated central bankers series. Llama 3 has some sense of humor Mark Zuckerberg

The rebalancing process means lower share of goods spending via prices (more deflation) and quantities. It also means service inflation can run a little hotter than normal to allow the share of spending in services to revert to pre-pandemic. Labor supply allows this process to

Chair Powell laid out 3 policy path scenarios - prolonged pause, goldilocks cuts and labor market weakness cuts. So instead of telling us the policy rate is likely at its peak, he laid out 3 scenarios that imply the policy rate is likely at its peak. A great way to focus

Since we have so many macro experts who form conclusions from a headline number, let me add some granularity and add a few dimensions to this loosey goosey hot wages narrative. First, 30 bps of the private industry workers +1.1% QoQ were contributed by Professional and business

There is a “dance” between markets and the Federal Reserve as the Fed leans on markets to do some of their work - at times. My colleague and macroeconomic mentor Ricardo Caballero outlines the mechanics of this dance in his 2020 paper “Monetary Policy with Opinionated Markets”

OER and Rent inflation NSA confirmed the major step down of March. It also confirmes the Detroit anomaly was just that. This is highly relevant as the seasonal adjustments are clouding the trend. Now that high seasonal are behind, seasonally adjusted data will trend lower for

2 quick facts about NFP forecasters: 1- They love to cluster around the median 2- Independent thinkers, those that deviate the most from the median, tend to have the largest misses For tomorrow, and narrowing the sample to the last 3 prints, 2 of the best forecasters are above

Northeast OER NSA MoM prevented Core CPI to be closer to 10 bps Very likely we see a reversal of this jump, which keeps the OER NSA MoM downtrend in great shape The “New York” anomaly contributed 12 bps more to OER NSA MoM National Average !!! Nick Timiraos Jason Furman

Agreed

Hi recessionistas - formerly in the higher for longer and sticky inflation camp - did anyone checked Initial Claims NSA today? 189k….

Given all the talk about the unwinding of the Yen carry trade, are Japanese bond investors bringing money back to Japan? NO! Chart shows recent flows out of Japan and into global bond markets (negative means very elevated outflow: >$40bn worth in a month, from Japan to abroad)

The most relevant message “The Fed put is ATM” All the rest is mental gymnastics