Action Economics Survey results:
Action Economics Survey results: ooops said the NY Fed -- President Williams didn’t mean to suggest a 50 bp rate cut is the cards. Chair Powell had already strongly hinted in his Monetary Policy Report that more stimulus was on the way at the end of the month. The only question was size. That was pretty much determined to be a 25 bp easing after St Louis Fed’s Bullard stated a more aggressive move wasn’t warranted currently. Stronger retail sales numbers, improved confidence, and hotter CPI data also militated against a 50 bp rate reduction. And yesterday's kerfuffle with Williams and the NY Fed's walk-back nearly assures a quarter point cut. And not surprisingly, it's unanimous in the Survey. There is considerably more uncertainty on the FOMC's next actions, however. The Survey Medians show no change in policy in September, but a 1.875% funds rate mid-point in place by the end of Q3. There is a lot of data ahead, and none of which really argue for stimulus. But then the FOMC isn't bases its decisions on the current state of the real U.S. economy. The Median shows Advance Q2 GDP growth slowing to 1.8%. Income and consumption are expected to increase 0.3% in June. The ISM is expected to rise to 52.0. And in the first week of August, nonfarm payrolls should rise 165k, with the unemployment rate dipping to 3.6%.