Given that a group of academics have recently raised their terminal rate forecasts, the likelihood of Fed officials following suit in their own economic projections is very high. Wall Street economists might be in a bit of a bind given that their largest clients are caught offside. The FT-Booth survey we discussed yesterday is very timely.
Here are some news articles and podcasts we've selected for you:
– Nick (Timiraos) the Greek of the WSJ writes that a US economic soft landing could prove elusive. He argues that rising commodity prices and recent pick-up in US economic indicators could force the Fed to hike interest rates further, eventually triggering a recession. It feels like everyone is keen to revive the recession narrative.
At this stage, the first-order policy action seems more plausible than banking on the second-order effect. And it's better to trade markets accordingly. As the facts and data change, so will our views.
– Wolfgang Münchau and his colleagues at Eurointelligence share a German perspective on the Russia-Ukraine war. The German parliament is dithering on supplying Ukraine with more advanced weapons. Listening to the contrasting views of a couple of native-born Germans and a Brit is interesting.
– Lianna Fix and Michael Kimmage in Foreign Affairs Magazine:
Kyiv Must Prepare for a Possible Change of Heart in America and Europe
The paywalled links should be available for our members.