US Monetary Policy

The Fed is sidelined on rates for some time as it watches how inflation evolves after an unexpected surge in Q1.

Any delay in achieving the 2% inflation target points to interest rates staying high for longer

The resilience of wages growth likely reinforces the Fed's concern that it may take longer for core inflation to return to the 2% target.

US core inflation remains persistently high.

US inflation and wages growth have peaked, but remain uncomfortably high for the Fed.

We've forecast a 30-60% correction in US equities since late 2021. Most of the price adjustment to date (~20-30%) looks to have been triggered by higher interest...