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Inflationtargeting

FED Fund Rate, US Bonds and Inflation PredictionThe blue line area shows the historic and current FED's Fund Rate. Looking back in the past it appears the US10Y (yellow line) is predictive of FED's fund rate upper target (orange arrows). The US3M (turquoise line) seems to be a good indicator to get a feeling for the FED's fund rate short-term up or downward trend. In the FOMC Summary of Economic Projections Jun 15 '2022 the FOMC had the midpoint of target range or target level for the federal funds rate at around below 4% 2022: 3,39% midpoint, 2023: 3.78%, 2024: 3.01% and >2024: 2,24% (ghost feed in the red box on the right). So all that noted it would appear the FED Funds rate is to be expected at just below 4% at around 3.8%. The next FOMC meeting will give as an update on that from the perspective of the FED. And as a general indicator you need to know the FED uses the 10 Year- 3 Month Treasury Yield Spread (white line) as follows: The 10 Year- 3 Month Treasury Yield Spread is the difference between the 10 year treasury rate and the 3 month treasury rate. This spread is widely used as a gauge to study the yield curve. A 10 year-3 month treasury spread that approaches 0 signifies a "flattening" yield curve. Furthermore, a negative 10 year-3 month spread has historically been viewed as a precursor or predictor of a recessionary period. The New York Fed uses the rate in a model to predict recessions 2 to 6 quarters ahead (white arrows). -------------------------------------------------------------------------------------------------------- ** Please support this idea with your likes and comments, it is the best way to keep it relevant and support me. ** -------------------------------------------------------------------------------------------------------- !! Donations via TradingView coins also help me a great deal at posting more free trading content and signals here !! --------------------------------------------------------------------------------------------------------
FRED:FEDFUNDSLong
by CarpeMomentum
Inflation: long term top or century breakout?Inflation Hits Fastest Pace Since 1981, at 8.5% Through March Gasoline weighed heavily in the increases, while prices moderated in several categories. Some economists say the overall rate may have peaked. Inflation hit 8.5 percent in the United States last month, the fastest 12-month pace since 1981, as a surge in gasoline prices tied to Russia’s invasion of Ukraine added to sharp increases coming from the collision of strong demand and stubborn pandemic-related supply shortages. Fuel prices jumped to record levels across much of the nation and grocery costs soared, the Labor Department said Tuesday in its monthly report on the Consumer Price Index. The price pressures have been painful for American households, especially those that have lower incomes and devote a big share of their budgets to necessities. But the news was not uniformly bad: A measure that strips out volatile food and fuel prices decelerated slightly from February as used car prices swooned. Economists and policymakers took that as a sign that inflation in goods might be starting to cool off after climbing at a breakneck pace for much of the past year. In fact, several economists said March may be a high-water mark for overall inflation . Price increases could begin abating in the coming months in part because gasoline prices have declined somewhat — the national average for a gallon was $4.10 on Tuesday, according to AAA , down from a $4.33 peak in March. Some researchers also expect consumers to stop buying so many goods, whether furniture or outdoor equipment, which could begin to take pressure off overtaxed supply chains. By Jeanna Smialek NYT April 12, 2022
ECONOMICS:USIRYY
by youknowram
Silver Trend OutlookSilver technicals and structure has an intact bullish makeup The long-term analysis shows that silver has cleared all major resistance and should follow gold to a new all-time high within the next 6-12 months, possibly much faster. The macro fundamentals are supremely bullish: Negative interest rates and the beginning of a global currency war/easing cycle/competition to devalue. Massive fiscal stimulus is on the horizon in the next 3-5 months, and not just in the US. Rest of the world is starting to catchup. The long-term global trend towards electric, clean, and renewable energy and the sheer amount of investment required to change our energy infrastructure will require that silver goes parabolic, along with many other commodities. There's not a lot of silver in the world. New production takes time, cannot happen overnight. A Biden win / blue wave will mean marginally more open global trade, which is bullish commodities. It will also mean something like a green new deal, infrastructure spending, and stimulus that could cause the US economy to overdose. FX_IDC:XAGUSD TVC:SILVER
TVC:SILVERLong
by Ludwig_Von_Mises
The myth of hyperinflation series- #3. Fed's effectivenessHow effective are Fed's monetary policies and tools? Fed has three simple goals- Grow GDP, keep inflation rate steady and keep the unemployment rate low. Some argue that Fed's perceived power over the market was exposed during several occasions- #1. During the 2008 in the midst of sub-prime mortgage crisis, the market continued to plunge despite the Fed's efforts to bail out Fannie & Freddie and other financial institutions, implement the Troubled Asset Relief Program (TARP) and issue $800b stimulus package. The market finally stopped the bleeding in early March 2009. #2. When Fed ended the QE3 in 2014 by announcing its attention to raise the interest rate and slash the Fed balance sheet, many people believed market would crash. Instead, market shot up to ATH in 2015. #3. This year during the onset of the Covid-19 crisis, Fed started out by cutting the rate by half percentage to no avail. Afterwards, Fed intensified its intervention effort by reducing Fed fund rate to zero. Nonetheless, the market tanked another 15% before it hit the bottom. One can point to the Fed-induced booming housing market in early 2000 as the major factor for the fast economic recovery after the Dot.com bubble and uses it as the counter example. Market is driven by crowd sentiment, but crowd sentiment, which in turns, is partially driven by Fed's decision. It is a chicken and egg conundrum. They both influence each other, but the degree to which each influences one another is impossible to discern. The safe conclusion to draw is that it would be overly optimistic to rely on Fed to get us out of the next financial crisis unscathed as it will take more and more stimulus package to get the job done. The best it can do is to mitigate the severity of damage. Next, let's examine some of the conditions and criteria that are related to inflation.
FRED:GFDEBTNEducation
by Libratus
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