A rather optimistic Head of the San Francisco Federal Reserve, Mary Daly, doesn’t think that the US is headed for a recession, arguing the US labour market is strong and that consumer spending is healthy.
Key comments:
- Supported the rate cut in July at the FOMC, but not on concern about any impending downturn for the economy.
- Labor market is at or near full employment.
FX implications:
The market doesn’t buy it according to the yield curve. The dollar can remain in tender-hooks from and US yields are trapped below the steep descending resistance line.
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