The risk of recession has risen, but it’s not a foregone conclusion.

We think the Federal Reserve will look past stronger-than-expected consumer price increases in June and July.

We find the Fed’s statement clear, and we expect another rate cut as soon as September with possible additional cuts thereafter.

The market consequences of direct intervention by the U.S. could be substantial and thus bear consideration.

The Federal Reserve is poised to cut interest rates at its July meeting. But how much will it cut?

June inflation may have been boosted by the recent increase in import tariffs, while inflationary pressures from rising wages and tight labor markets remain notably subdued.

The tone of the FOMC statement and press conference was a notable shift from the May meeting, given uncertainty around the economic outlook.

We don’t expect a Fed rate cut in June, but if downside risks to the economy escalate, a 50 basis point cut in July is possible, in our view.

New U.S. tariffs on Mexico would add to the direct economic costs of the string of tariff hikes enacted during this administration.

With the U.S. and China raising tariffs on each other’s goods, we may be entering a prolonged period of trade tension.

Shelter inflation, which tends to be influenced by the business cycle – and is therefore a focus for the Fed – was again firm.

A quiet and unsurprising FOMC statement belies the important policy discussions and decisions ongoing at the Fed.

As widely expected, the Federal Reserve held interest rates steady at this week’s FOMC (Federal Open Market Committee) meeting, but other aspects of the meeting had notable implications for markets and investors.

Rising input costs from the various import tariffs continue to support prices.

The Federal Reserve’s recently communicated change in its outlook for monetary policy has led to concerns that the Fed is overreacting to market volatility, or worse, succumbing to political pressures. However, we believe there is a more compelling reason for the dovish shift.

We think the Fed is right to be cautious in the face of rising global economic risks along with uncertainties surrounding politics and policy.

While we believe the shutdown on its own would have only a modest impact on growth, the combined impact of this and other short-term drags on the economy could slow first-quarter growth close to the zero mark.