Trade relations between China and the U.S. overshadow most everything as stocks enter the month of December, but in the week ahead the Fed and U.S. economy come back into play with important Fed testimony and the November employment report.
US: News
US, China Reportedly Reach Agreement to Halt Additional Tariffs After January 1, Chinese State Television
Gold Silver Reports (GSR) – Citing Chinese media, “no additional tariffs will be imposed after January 1, and negotiations between the two sides will continue,” the report said, according to state television’s English-language service. It gave no further details.
Fed Points to December rate hike but is worried about Tariffs and Debt
Minutes released Thursday from the Nov. 7-8 meeting of the Federal Open Market Committee, which sets interest rates, pointed toward the strong likelihood of another quarter-point adjustment in the central bank’s benchmark rate target next month.
JP Morgan economists said the Economy Should Grow at a Slower Pace of 1.9 Percent From the Fourth Quarter’s Year over Year Rate of 3.1 Percent
The economist say the slow down from a “boomy” 3.1 percent in year-over-year fourth quarter growth will come as fiscal, monetary and trade policy get less supportive or more restrictive.
Fed Set for a Broad Review on How it Conducts Policy in 2019
Gold Silver Reports (GSR) – Central bank officials announced Thursday that they will look at “strategies, tools, and communication practices” the Fed uses to formulate monetary policy.
Breaking News – Fed’s Vice Chairman Clarida: Would Not Agree That Fed Hikes Are Going Too Far Or Too Fast -Will Set Policy To Meet Congressional Goals
Fed’s Vice Chair Clarida: Gradual Approach Has Served The Fed Well – CNBC -Policy Rate Is Barely Above Inflation Rate -Fed Needs To Be Data dependent
The Fed Has to Talk a Big Game
Ultimately, he thinks the Fed will not act as aggressively as stated through their current projections. The Federal Open Market Committee in September indicated another rate hike this year, bringing the 2018 total to four, along with three more next year and another hike or two in 2020.