Matt Sherwood at Perpetual: The Fed is too optimistic
Matt Sherwood at Perpetual: The Fed is too optimistic. I think the US economy remains subdued and that the US Fed's outlook is too optimistic. That said growth will improve, as the weather improves and the inventory cycle runs its course and industrial production picks up to supply a still hungry consumer, but the pick-up may take well into the second quarter to become evident and it may be less egregious than risk-hungry investors' desire. The key remains business investment and there is nothing in today's report that suggests that this is about the turn, indeed, corporate American seems to be sitting on its hands giving cheques out to investors today, rather than focusing on the long-term and determining strategies which will underpin larger cheques tomorrow.