Apollo’s Slok says increasing chance Fed rates hold in November – 10 tailwinds for economy

Torsten Slok is chief economist at Apollo Management.

Voicing what many are seeing is super-obvious but nevertheless ignored in the thirst-trap of seeking lower rates:

• bottom line is that the expansion continues
• Atlanta Fed currently estimates third-quarter (3Q) GDP growth of 3.4%
• US remaining on a no landing trajectory — economy keeps growing and inflation reignites
• continued support from government spending
• US election uncertainty will soon be behind us

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Obviously I think Slok has a good case. I’ll stick a caveat in that Fed communications mention the September rate cut as a ‘recalibration’, shying away from the ‘easing’ word. I guess if the ‘recalibrate’ lower again it gives them space to hike down the road if they need to. Huh. that’ll be a popular view….

This article was written by Eamonn Sheridan at www.forexlive.com.