HALISTER1: Fed Inflation Language ‘Not All That Important’: Charles Schwab

Fed Inflation Language ‘Not All That Important’: Charles Schwab

(Bloomberg) -- The Fed’s omission of “somewhat” in part of its inflation assessment simply acknowledges that inflation has come down, Charles Schwab analyst Kathy Jones said in a Bloomberg TV interview.
  • Fed will still hike rates at modest pace, shows “clear eagerness” to start balance sheet runoff; markets had expected more hawkishness in statement
  • Concerned about market’s “complacency”; VIX index “really low,” MOVE index at lowest level since tracking started in 1998, credit spreads “really tight”
  • If dollar starts to rebound as Fed tightens and trims balance sheet, there could be “some vulnerability” in EM credit’s “really tight spreads”
  • Next Fed chair may be neither Yellen nor Cohn; “I think they may go for a more conventional pick”
To contact the reporter on this story: Anna Windemuth in New York at awindemuth1@bloomberg.net To contact the editors responsible for this story: Boris Korby at bkorby1@bloomberg.net Greg Chang

Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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Kathy Jones (Charles Schwab Corp/The)

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