Global central banks holding steady for now
|Summary
United States: Steady, as she goes
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This week's economic data largely reinforced existing economic growth patterns. Consumer momentum remains largely intact, inflation continues to inch back down, albeit at a slower pace, and rate-sensitive sectors stayed in a holding pattern.
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Next week: ISM Indices (Mon. & Wed.), Trade Balance (Thu.), Employment (Fri.)
International: Global central banks holding steady for now
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This week saw the announcement of monetary policy decisions from both G10 and emerging market economies. Sweden’s Riksbank held its policy rate steady at 4.00% and opened the door for either a May or June rate cut. We maintain our call for an initial June cut for now. The South Africa Reserve Bank held its policy rate steady at 8.25% and offered hawkish-leaning guidance.
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Next week: China PMIs (Sun.), Japan Tankan Survey (Mon.), Eurozone CPI (Wed.)
Interest rate watch: Dancing with the stars: The first of many ticks higher in the longer-run median dot
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Last week, the median “longer-run” dot moved higher in the FOMC’s latest Summary of Economic Projections (SEP). The increase in the median dot was small (just 6 bps), but the uptick in the median marks the first time it has been above 2.5% since March 2019. We expect the longer-run dot to continue to cautiously drift higher in coming SEP meetings.
Topic of the week: Economic costs of the Francis Scott Key Bridge collapse
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The Francis Scott Key Bridge collapsed early Tuesday morning when a cargo ship leaving the Port of Baltimore collided with one of the bridge's support pillars. How important is the Port of Baltimore to U.S. goods trade?
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