The Capital Spectator: Investing, Asset Allocation, and Economic Insights

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    <p>The Federal Reserve announced on Wednesday that it has <a href="https://www.wsj.com/articles/fed-raises-interest-rates-for-first-time-since-2018-11647453603">increased</a> its target interest rate by ¼ point, marking the first hike since 2018. This adjustment in monetary policy was anticipated, given the recent inflation surge. Additionally, the weak performance of fixed-income securities this year continues to forecast challenging times for this asset class moving forward.</p>

    <p> <a href="https://www.capitalspectator.com/us-bond-market-under-pressure-as-fed-raises-interest-rates/#more-17671" class="more-link">Continue reading <span class="meta-nav">→</span></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/us-bond-market-under-pressure-as-fed-raises-interest-rates/" title="7:52 am" rel="bookmark"><time class="entry-date" datetime="2022-03-17T07:52:48-04:00">March 17, 2022</time></a>
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    <p>* Western nations report that Russia is <a href="https://www.reuters.com/world/europe/shells-hit-theatre-sheltering-ukraine-civilians-biden-calls-putin-war-criminal-2022-03-17/">struggling</a> in the Ukraine conflict<br/>* The Fed <a href="https://www.wsj.com/articles/fed-raises-interest-rates-for-first-time-since-2018-11647453603">increased</a> its benchmark interest rate by ¼ point—its first hike since 2018<br/>* Fed Chair Powell <a href="https://www.bloomberg.com/news/articles/2022-03-16/powell-scoffs-at-recession-talk-and-stock-cacophony-is-quieted?srnd=economics-vp">downplayed</a> recession fears, stating they are “not particularly elevated,” yet…<br/>* Some economists <a href="https://www.nytimes.com/2022/03/16/opinion/fed-rate-increase.html">believe</a> the Fed's actions may lead to a recession<br/>* Russia has <a href="https://www.cnn.com/2022/03/16/business/russia-aircraft-seizure/index.html">seized</a> numerous commercial aircraft owned by U.S. and European firms<br/>* U.S. import prices have <a href="https://www.marketwatch.com/story/import-prices-jump-10-9-in-the-past-year-adding-to-high-u-s-inflation-11647434869">increased</a> by 10.9% over the past year, contributing to inflation levels<br/>* Sentiment among U.S. homebuilders <a href="https://www.cnbc.com/2022/03/16/homebuilders-sales-expectations-drop-dramatically-as-mortgage-rates-soar.html">declined</a> in March, marking the fourth consecutive monthly drop<br/>* Inflation expectations from the Atlanta Fed <a href="https://www.atlantafed.org/research/inflationproject/bie">rose</a> again in March<br/>* U.S. retail sales <a href="https://www.cnbc.com/2022/03/16/retail-sales-february-2022-.html">increased</a> less than expected in February amid rising inflation:</p>
    <p><a href="https://www.capitalspectator.com/wp-content/uploads/2022/03/retail.17mar2022.png"><img decoding="async" class="alignnone size-full wp-image-17670" src="https://www.capitalspectator.com/wp-content/uploads/2022/03/retail.17mar2022.png" alt="" width="654" height="408"  /></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/macro-briefing-17-march-2022/" title="6:02 am" rel="bookmark"><time class="entry-date" datetime="2022-03-17T06:02:03-04:00">March 17, 2022</time></a>
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    <p>The Federal Reserve is navigating a particularly challenging environment: increasing interest rates while economic growth is slowing. Their motivation for tightening policy stems from surging inflation, which has overtaken concerns about growth.</p>

    <p> <a href="https://www.capitalspectator.com/fed-to-start-hiking-rates-as-us-growth-slows-and-inflation-spikes/#more-17664" class="more-link">Continue reading <span class="meta-nav">→</span></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/fed-to-start-hiking-rates-as-us-growth-slows-and-inflation-spikes/" title="7:39 am" rel="bookmark"><time class="entry-date" datetime="2022-03-16T07:39:20-04:00">March 16, 2022</time></a>
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    <p>* Ukrainian President Zelensky is set to <a href="https://www.reuters.com/world/ukraine-president-zelenskiy-seek-more-help-speech-us-congress-2022-03-16/">address the U.S. Congress</a> today to seek further assistance<br/>* European leaders <a href="https://www.wsj.com/articles/russian-missiles-strike-kyiv-as-fighting-rages-on-edge-of-ukraines-capital-11647340678">are visiting</a> Kyiv as Russia intensifies its bombardment<br/>* Russia's foreign minister <a href="https://www.ft.com/content/7b341e46-d375-4817-be67-802b7fa77ef1">claims</a> there is ‘hope’ for a resolution in talks with Ukraine<br/>* The country is facing a potential <a href="https://www.wsj.com/articles/what-to-know-about-russias-possible-debt-default-11647423003">debt default</a> as payments are due<br/>* Economists are <a href="https://www.cnbc.com/2022/03/15/forecasters-sees-growing-chance-of-a-recession-as-fed-hikes-rates-this-year-to-fight-inflation.html">increasing</a> U.S. recession risk estimates due to rising inflation concerns<br/>* Futures market anticipates a 25-basis-point rate increase during today's FOMC meeting<br/>* Sarah Bloom Raskin has <a href="https://www.cnbc.com/2022/03/15/sarah-bloom-raskin-withdraws-her-candidacy-for-federal-reserve-board-reports-say.html">withdrawn</a> her nomination for a position on the Federal Reserve board<br/>* February saw a slight easing in U.S. wholesale inflation, yet it remained up by 10% year-over-year<br/>* The New York Fed Manufacturing Index indicates a <a href="https://www.nasdaq.com/articles/new-york-manufacturing-index-indicates-unexpected-contraction-in-march">contraction</a> in March—the first decline in nearly two years:</p>
    <p><a href="https://www.capitalspectator.com/wp-content/uploads/2022/03/nyfed.16mar2022.png"><img loading="lazy" decoding="async" class="alignnone size-full wp-image-17663" src="https://www.capitalspectator.com/wp-content/uploads/2022/03/nyfed.16mar2022.png" alt="" width="606" height="377"  /></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/macro-briefing-16-march-2022/" title="6:21 am" rel="bookmark"><time class="entry-date" datetime="2022-03-16T06:21:06-04:00">March 16, 2022</time></a>
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    <p>The ongoing surge in inflation is intensifying, and is likely to escalate further as the ramifications of the conflict in Ukraine become evident in forthcoming data. A significant question arises: Is the current pricing pressure a temporary fluctuation or an enduring trend? To provide context, let us estimate the inflation "cycle" based on a straightforward analysis that seeks to capture the long-term variations in inflation dynamics.</p>
    <p> <a href="https://www.capitalspectator.com/the-inflation-cycle-looks-unusually-hot/#more-17658" class="more-link">Continue reading <span class="meta-nav">→</span></a></p>
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    By James Picerno | <a href="https://www.capitalspectator.com/the-inflation-cycle-looks-unusually-hot/" title="7:41 am" rel="bookmark"><time class="entry-date" datetime="2022-03-15T07:41:51-04:00">March 15, 2022</time></a>
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