May Fed Meeting Preview: Macro Matters

In this Macro Matters edition, host and BI Chief U.S. Interest Rate Strategist Ira Jersey is joined by BI Associate Interest Rate Strategist Angelo Manolatos.

Jersey previews his views for the May 4th FOMC meeting and discusses his view for future 50bps interest rate increases and the possible affect on the Treasury yield curve. The team's written preview can be found Fed Terminal-Rate Calibration Makes Pace of 2H Moves Uncertain. He also mentions the Treasury Department's refunding announcement expected a few hours prior to the Federal Reserve statement release. He expects coupon security auction sizes to stabilize after having been cut the past several quarters. Manolatos then discusses his view for the Bank of Canada and inflation expectations. Jersey also mentions the risk that inflation may remain above the Fed's target and what might occur if the central bank remains quite hawkish. Manolatos then discuss how quickly the Fed's Treasury Bill portfolio will runoff given current asset runoff plans.