Soft US data support dovish tilt by Fed Chair
by AIB Treasury Economic Research Unit
- As political events dominated the news agenda in the past week, the ECB forum in Sintra gave important hints towards near term monetary policy.
- However, despite Lagarde’s cautious outlook, markets are still pricing in nearly two further cuts by end-2024, beginning in September.
- US Fed Chair Powell also gave remarks at Sintra, widely received as more dovish in nature than recent comments.
- Indeed, the Fed minutes from their June meeting highlighted a growing consensus that the disinflationary trend has now reemerged in the US, following a plateauing in inflation at the beginning of 2024.
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