Such a level of deficit is unprecedented except for important crises or war periods.
These forecasts are also based on the absence of recession and a decline in interest rates compared to their current level.
Source: BOFA, Global Markets Investor, CBO: BOFA, Global Markets Investor, CBO
5. US state debt should reach a colossal amount of $ 59 billion in the next 10 years.
This would be to double the level of 2021. This projection does not take into account the impact of a possible recession that could still speed up an increase in public debt.
Source: CBO, BOFA: CBO, BOFA, Global Markets Investor
Fed keeps its rates in a fork of 4.25 to 4.5 %, but still plans two drops by the end of the year
As expected, the federal reserve system maintained its unchanged reference interest rate at 4.25-4.5 %. This decision is consistent with the latest American economic indicators. Inflation pressures remain high and could intensify according to the size and consequences to a large extent the expected increase in import obligations for imports currently negotiated between the United States and its business partners.
President Powell acknowledged that although certain uncertainty associated with trade tension has decreased, the persistent instability in the Middle East could temporarily increase energy prices. However, it minimized the likely fiscal impact of the future “large beautiful account”, suggesting that its importance to the Federal Open Market Federal Committee (FOMC) is limited due to the size of the US economy. Powell also described the current key rate of “slightly restrictive” with regard to good economic performance.
The most important development of the Fomc meeting has appeared to summarize economic projections (MS). In March, the median forecast indicated two drops of rates, but in a cautious tone, because four members did not give any decline for this year. Since then, this caution has increased, seven members now expect any reduction in 2025, a significant change that reflects a more optimistic vision of certain FOMC participants in terms of future interest rate trajectory.
Further changes have appeared in projections for 2026 and 2027, where the creators of political decisions only ensure a reduction in rates for each year, which is a reduction compared to two reductions previously set in two years. At the same time, growth forecasts for 2025 and 2026 were slightly revised down, while the prospects of inflation (measured PCE) for 2025 were revised up, in accordance with the Forecasting of the Committee.
Investors were assured by a clear message, both direct and implicit, according to which the federal reserve system and FOMC seek to maintain its independence and remain safe from national political pressures that require an early rate to reduce.
Source: Holgerz, Bloomberg: Holgerz, Bloomberg
BNS reduced its rates by 25 basic points, which brought the term “zero” to the lexicon of interest rates
As expected, the Swiss National Bank (BNS) has made a new decline in rates, thus increasing the Swiss key rate to zero. Although it approaches the negative territory, BNS has so far avoided the re -introduction of this often criticized measure.
Despite this decline, the central bank has strongly revised its inflation projection, inflation is now approaching the lower part of its target range from 0 % to 2 %. This suggests that the decision could be taken by the BNS Committee.
The decision made the day before the federal reserve system to maintain its interest rates provided SNB some room for maneuver to slightly reduce the abyss between interest rates, reducing relative attraction compared to the federal reserve system, however, emphasized the increased uncertainty that the global economy faced.
During the press conference, President BNS, Mr. Schlegel, also emphasized the negative consequences of negative interest rates and emphasized the difficulties that create many actors in the economy. This cautious approach, which aligns the reserves issued previously SNB with respect to rates less than zero, means that such a measure would only be expected if the prospects of inflation were significantly deteriorated.
Given the current situation, we expect BNS to maintain a key rate for zero until the end of the year without providing further reduction. We share the assessment of the President of the Federal Reserve, Jerome Powell, according to which different global risks such as the Middle East tension or current commercial conflicts concerning the United States could exert pressure on inflation.
As a result, at this stage, it does not seem just to reduce the guide rates in the negative territory.
Source: Holgerz, Bloomberg: Holgerz, Bloomberg
McDonald’s prices in the United States have jumped over the last ten years …
The “McDonald” price index (NYSE 🙂 reveals reality …
Source: www.carbonfinance.io
The Banks Power plants continue to leave the US dollar in favor of:
According to the World Golden Council survey, 95 % of central banks determine the increase in world reserves in the coming year.
43 % of them intend to increase their own gold reserves, a record.
In addition, 73 % of central banks expect reserves in US dollars in the next five years.
Source: Yahoo Finance
(Tagstotranslate) US budget