James Knightley

Elevated inflation and strong activity and jobs numbers have pushed market expectations for the timing of the first interest rate cut to December. We still see an opportunity for a September rate cut. Nonetheless, the Federal Reserve will remain wary and signal that if inflation stays high, so will interest rates

US labour costs accelerated in the first quarter, led by the government sector, while hikes to state minimum wage levels contributed to higher private sector labour costs. This is the Federal Reserve’s favoured measure on labour market inflation pressures and provides further ammunition to justify a hawkish shift at tomorrow’s FOMC meeting

There are a few more tentative signs of economic softness coming through in the US data, but inflation continues to run far too hot for comfort. Today’s Federal Reserve FOMC meeting is likely to see the Fed adopt more hawkish language than at the March FOMC meeting, but they certainly won’t close the door to potential rate cuts later in the year

The Federal Reserve left its policy rate unchanged and argued its policy stance is “in a good place”, but officials are concerned about the recent lack of progress on inflation. Rate hikes remain unlikely, but the Fed is prepared to leave interest rates at current levels until that progress is achieved or the jobs market clearly weakens

A quiet week in the US features the Senior Loan Officer Opinion survey as the main highlight. Elsewhere, we see a brighter UK outlook as signs point to positive growth in the first quarter, another subdued jobs report in Canada, and the Riksbank cutting by 25bp. Hungarian inflation figures and Poland’s next central bank meeting will also be in focus

Job creation was weaker, unemployment higher and wage growth more subdued than expected in the April employment report. With Fed Chair Powell leaning dovish at Wednesday’s press conference this has breathed new life into Federal Reserve interest rate cut calls

The US growth story remains driven by consumer resilience. High income households are in a great financial position, but those on lower incomes are feeling intensifying stress. How these competing stories play out will be key to the growth outlook for the rest of the year and the prospect of Federal Reserve interest rate cuts

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Despite recent setbacks, we continue to expect three rate cuts from the US this year, starting in September. A European Central Bank rate cut in June looks like a done deal

Are there still parallels between the US and Australian economies? We take a look