Analyst: Fed's Revision of Economic Expectations Won't Have Major Impact on Financial Markets

Josh Jamner, senior investment analyst at investment firm Clearbridge, believes that the Fed's economic expectations imply that policymakers now expect less favourable economic conditions this year, with a mild economic slowdown and rising inflation and unemployment. These changes are consistent with the expectations of banks and macroeconomic researchers that have been circulating on Wall Street in recent weeks, so in our view they will not have a significant impact on financial markets. Ultimately, Fed policy will give way to the fiscal side of the equation, and with pricing in the federal funds futures market implying that the next rate cut will not occur until July, this dynamic is unlikely to change anytime soon.