Fed Preview: Time To Reverse Course

It’s been a tough year for the Federal Reserve...and it’s only June! Berated in some corners for pushing up interest rates late last year, the Fed changed its tone in January and seemed set for a long, comfortable pause. Then came a barrage of criticism from the White House and an unexpected escalation of global trade tensions. The outlook has become murkier and riskier, leading the markets to cry out for easier monetary policy.

We think the Fed will be forced to acquiesce. Probably not at this month’s meeting; there hasn’t been enough time to send the proper signals to the markets. But lower rates are coming. Here is our take on the likely content of next week’s conversations.