Excerpt from…
The Fed can’t figure out what’s happening with the job market
June 1, 2023 – Analysis by Nicole Goodkind, CNN – Quoted: David R. Kotok
New York (CNN) — Policymakers at the Federal Reserve signaled last month that they were considering a pause in their 14-month long regimen of hiking interest rates to cool the economy and bring down inflation.
But the US economy is like an engine that won’t quit — it just keeps on pumping out jobs. New data out Wednesday showed that job openings and hiring both rose in April, while unemployment sits near 53-year lows. With just two weeks left until the central bank’s next policy decision, it appears that more rate hikes could be coming after all.
“After last month’s meeting, it seemed certain that the word change signaled that the Fed was on pause,” said Sam Stovall, chief investment strategist at CFRA research.
“However, due to stronger-than-expected economic reports, stickier-than-anticipated inflation readings, and increasingly hawkish Fedspeak, we now see the [Fed] postponing its pause and raising rates by [a quarter percentage point],” he said.
The bottom line: Uncertainty seems to be the name of the game right now. “Markets may wish for a Fed pivot, but we believe that hope is not a strategy,” said David Kotok, chairman and chief investment officer at Cumberland Advisors. “Of course,” he added, “that could change at any time.”
Read the full story at CNN: https://www.cnn.com/2023/06/01/investing/premarket-stocks-trading/index.html
David R. Kotok
Chairman & Chief Investment Officer
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