Analyst calls for verbal intervention from the Federal Reserve

August 05, 2024 at 11:53PM
ICYMI – A snippet via the news wires overnight from Capital Economics:

Fed needs to do at least a verbal intervention to calm down financial markets

Fedspeak might avoid an emergency rate cut

“At this point it’s really about restoring market functioning–they could damp things down with a few well placed verbal interventions, it wouldn’t necessarily require inter-meeting cuts.”

says interest rate cuts between meetings “can backfire if the market thinks the central bank knows more than they do”

We did get some soothing remarks from Fed officials on Monday US time:

Fed’s Goolsbee: Jobs numbers are weaker but it’s not looking yet like a recession

Fed’s Daly says minds are open to cutting rates in coming meetings

More from Fed’s Daly – monitoring labour market indicators carefully

There are plenty more talking heads available if needed

This article was written by Eamonn Sheridan at www.forexlive.com.

Analyst calls for verbal intervention from the Federal Reserve