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The financial markets are getting ahead of themselves in a bad case of rate cut fever, Fed chair Jerome Powell, and St. Louis Fed President James Bullard both said today.

This is a message that I’ve been waiting to hear as the financial markets moved to price in not a 25 basis point cut interest rates at the Fed’s July 31 meeting, but a 50 basis point cut then and another 25 basis point cut in September. My thinking has been that if the Fed didn’t begin to walk back market expectations soon, it meant that the central bank was comfortable with the market’s projection.

Turns out the Fed isn’t.

One 25 basis point cut in July, Sure, was the message from both Powell and Bullard.

But 50 points in July wasn’t indicated by current economic conditions–even factoring in the slowdown in the global economy from the Trump administrations tariff policy.

And as a second cut in September, the message from Powell & Co. so far is patience. Give the Fed more time to see how weak or strong the economy is before pricing in a second interest rate cut in 2019.

After these comments the odds of a 50 basis point interest rate cut at the July meeting decreased to 36% from 43%.

These cautious statements–one rate cut is indicated but two isn’t baked in–have led to a continuation of the modest reset in stock prices. As of 2:30 New York time today the Standard & Poor’s 500 is down 0.90% and the Dow Jones Industrial average is off 0.68%. The technology heavy NASDAQ Composite has dropped 1.51% and the small cap Russel 2000 has slid 0.21%. As you might gather from the performance of the wider indexes, technology stocks are down strongly today with the Technology Select Sector SPDR ETF (XLK) down 1.91%. But the modest retreat is spread across the markets with the financial, energy, and utility ETF, XLF, XLE, and XLU, respectively, all down.

The yield on the 10-year Treasury are back below 2% at 1.99% after moving higher earlier in the session on the Fed comments. The yield on the 2-year Treasury is at 1.73%.

Gold prices have climbed again with the August futures contract on COMEX putting gold up 0.51% to $1425 an ounce.

Oil isn’t going anywhere today with the U.S. benchmark West Texas Intermediate unchanged at $57.90 a barrel. International benchmark Brent crude is 0.39% higher to $65.11 a barrel.