In today’s briefing:
- Fed Policy Outlook: Could Housing’s Resilience Force a Higher Inflation Target?
- The Weekly Market Monitor – Spending Pressure, Labor Lull, and Bitcoin Fatigue
Fed Policy Outlook: Could Housing’s Resilience Force a Higher Inflation Target?
- Lack of existing homes for sale has supported the demand for new homes where homebuilders have assisted buyers via mortgage rate buy downs.
- House price appreciation has resumed again, despite tougher comparisons, thereby helping to support aggregate demand. Future disinflation could spark swiftly declining borrowing costs, thereby complicating policy conduct for the Fed.
- Further home price appreciation could undermine the Fed’s efforts to achieve 2% inflation, but political pressure to raise the target could increase in order to maximise full employment and homeownership.
The Weekly Market Monitor – Spending Pressure, Labor Lull, and Bitcoin Fatigue
- This week, we look at the skewed US personal income and spending data, concluding that wage growth must take over quickly to keep spending afloat.
- This week, we look at the skewed US personal income and spending data, concluding that wage growth must take over quickly to keep spending afloat.
- We discuss the latest developments surrounding Bitcoin and a spot Bitcoin ETF. While approval odds steadily rise, low attention and trading volumes reveal that investors are preoccupied with AI.
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