From Bloomberg via ZeroHedge, July 31:
As the market tries to digest Fed speak, here are some of the fastest Wall Street commentators and strategists piling on with their initial reactions to the FOMC statement, if not Powell's presser.
UBS trader Leo He:
"The Fed keeps rates unchanged. In the policy statement, the Fed changes its language to "the Committee is attentive to the risks to both sides of its dual mandate," where previously it said "the Committee remains highly attentive to inflation risks". However, the Fed maintains: "The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent." This statement is definitely more dovish than the June statement, as the Fed says they are focusing on dual mandates now. But this is definitely not a complete pivot. Austan D. Goolsbee, the most dovish FOMC member, voted as an alternate member at this meeting, as Mester retired. Beth M. Hammack will take the president office of Cleveland Fed later this month and likely take over the voter role from September."
Derek Tang, economist with LH Meyer/Monetary Policy Analytics:
“Quite balanced, and nicely captures the moderation in inflation and the real side without fueling the flames of adding a November cut too. A September easing should still be a go, barring anything that would stay their hand. It would be hard to see what would do that at this point.”
Win Thin, global head of markets strategy at BBH:
“I think many were hoping for some sort of softening here, along the lines of ‘we have somewhat greater confidence’ but the Fed did not tip a September cut, by any stretch. I think they will cut, but the Fed is playing its cards close to its chest. Marginally less dovish than expected."
Ira Jersey, Bloomberg Intel chief rates strategist:
“Overall, the Fed’s policy statement appears to meet our expectation in that it is balanced. The new phrase ‘risks to both sides of its dual mandate’ doesn’t signal a September cut is imminent. The front end of the curve selling off the knee-jerk bear flattener seems reasonable. Powell’s press conference may be more telling than the incremental shifts in the statement.”
George Catrambone, head of fixed income, DWS Americas:
“The risks are much more two-sided. They’ll be able to get more data to confirm the disinflationary path, but soft landings don’t materialize by waiting too long to cut.”
Neil Dutta, Renaissance Macro
“With language like this, it means the Fed will have to make a more pronounced shift in language in September. I am surprised stocks are holding up on this statement. Perhaps equities are looking ahead to the press conference. The minutes of today’s meeting, along with the Jackson Hole central banking conference in August, will offer further opportunities."....
....MUCH MORE
