Warsh, Oil, And The April FOMC: The Case For June Rate Cuts

The article argues the market is underestimating Fed easing capacity, citing contained core inflation despite an oil shock and labor data consistent with a no-hire, no-fire economy. The first rate cut is not expected until the June FOMC meeting at the earliest. The message is supportive of bonds and rate-sensitive assets, but still implies patience before policy easing begins.

Analysis

The article argues the market is underestimating Fed easing capacity, citing contained core inflation despite an oil shock and labor data consistent with a no-hire, no-fire economy. The first rate cut is not expected until the June FOMC meeting at the earliest. The message is supportive of bonds and rate-sensitive assets, but still implies patience before policy easing begins.