Center Stage

Fed's timing and direction of future rate moves has taken much bigger consideration

Summary: The economy is doing well overall. Consumer spend is resilient, even though savings rates are falling. Fed policy is center stage at this time. Most market participants seem to expect that we’ll avoid rate hikes but interest rates will stay higher for longer.

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Macro

The US economy is doing well overall 

"I think the economy in the United States is generally doing well. I would say it's stable and resilient. I think there are uncertainties around where inflation is going. It's been a little bit sticky, but generally coming down. And I think the Fed is doing a really nice job in terms of kind of managing through that" - US Bancorp (USB 0.00%↑) Chief Administration Officer Terrance Dolan

Consumer spend is resilient 

"Consumer spend is continuing to hold up pretty stable. And I would say that the things that are impacting them is inflation. The labor market is tight. Unemployment is only at 3.9%. All those things kind of come back to -- from a consumer perspective, they've been pretty resilient." - US Bancorp (USB 0.00%↑) Chief Administration Officer terrance Dolan

“We see consumer spend in North America remaining resilient, that we have factored in headwinds related to FX from the strong U.S. dollar and some softness in European consumer spending in our Q2 outlook” - Shopify (SHOP 0.00%↑) CFO Jeff J. Hoffmeister

Saving rates are falling though

"The consequence of continuing consumption growth against flat disposable income has been a downward trend in the personal savings rates, which have fallen back towards the 3% level after peaking almost one year ago, and matched by a continuously falling balance of real savings deposits. In an economy with strong headline growth numbers and low unemployment, the anemic savings rates and declining real savings balances are the clear problem statement." - Upstart (UPST 0.00%↑) CFO Sanjay Datta

Federal Reserve policy is center-stage

"...new heightened uncertainty about inflation and the Federal Reserve's timing and direction of future interest rate moves has taken a much bigger part of center stage thought and consideration." - Franklin Street Properties (FSP 0.00%↑) CEO George Carter

"...if we had this meeting back in February, we probably would have been talking here about lots of rate cuts as inflation got more rooted in the U.S. economy. Now a few weeks ago, it was maybe rate cuts are in the second half. And then last week employment goes up a little bit. Now they're thinking maybe a rate cut in June. There's enough volatility in all that." - Equifax (EFX 0.00%↑) CEO Mark Begor

People expect higher for longer, but not increasing rates

“I think the other uncertainty that is kind of tied to that is just what's going to happen with respect to interest rates…I think, while it may be higher for longer, I don't think that there is a risk associated with rates increasing from here. And I think it's more of the timing of when rates start to come down, which is good. But there is a fair amount of uncertainty that exists out there." - US Bancorp (USB 0.00%↑) Chief Administration Officer terrance Dolan

International