BlackRock over rentebesluit Fed: tegenstrijdig beeld bemoeilijkt vooruitblik

Aug 1, 2019

Het is lastig voor de Fed om vooruit te kijken door het tegenstrijdige beeld van enerzijds het zeer hoge consumptieniveau en anderzijds de verslechterende bedrijfsomstandigheden, aldus Rick Rieder, Chief Investment Officer van Global Fixed Income bij BlackRock in een reactie op het rentebesluit van gisteren.

Enkele hoofdpunten:

•Het besluit van de Fed om de rente met een kwart procentpunt te verlagen en te stoppen met de balansverkleining was grotendeels conform de marktverwachtingen, al hebben de markten voor risicobeleggingen enigszins teleurgesteld gereageerd.

•De maatregelen van de Fed moeten in een mondiale context worden gezien, aangezien de Fed in wezen het beleid versoepelt om te voorkomen dat de zwakte van de wereldeconomie al te zeer doorsijpelt in de relatief sterke Amerikaanse economie.

•Het is onduidelijk wat de volgende rentestappen zullen worden; wij nemen het van de Fed aan dat deze sterk afhankelijk zijn van binnenlandse en wereldwijde economische omstandigheden en dat de Fed indien nodig verdere versoepeling zal bieden. Stelligheid over aankomende rentestappen is niet op zijn plaats.

•We waren niet verbaasd dat de Fed aankondigde om de balansverkleining in augustus stop te zetten. Per saldo zou dit de markten en de economie moeten ondersteunen.

Hieronder het volledige commentaar

​Fed Hits It Right Down the Fairway

Today's policy moves from the Federal Reserve were both widely anticipated and broadly within the range of market expectation. Specifically, the FOMC cut its Fed Funds policy rate range by a quarter-point, to between 2.0% and 2.25%, as economic commentators and markets widely expected, and notably it represents the first Fed rate cut in 11 years. And though some were hoping for a half-point cut, today’s action fell broadly within consensus expectations. Risk-asset markets were moderately lower on the news. In the course of the press conference it became clear that there was some question as to the forward plan on rate moves from here. We think that we should take the Fed at its word at this point that it will be dependent on domestic and global economic conditions and will provide more accommodation as necessary from this point forward, but any conviction on built-in forward rate cuts from here should be dismissed.

It’s worth noting that there are a variety of factors driving Committee members’ views on the appropriate policy stance at this stage in the cycle, including: more structural factors involving inflation and inflation expectations, traditional cyclical factors, such as the modest growth slowdown underway, and global developments, like the U.S./China trade conflict, Brexit, and the broad-based slowing of growth globally. Overall, markets attempting to price the likelihood of further Fed easing will be driven by the confluence of how these varying factors evolve. Finally, though it had been less discussed, we were unsurprised to see the Fed decide to halt its balance sheet runoff in August, which should also help support markets and the economy on balance. Indeed, we have long argued that Fed balance sheet policy was contributing to a diminishment in total global liquidity (see graph), which came to a head in the fourth quarter last year before recovering modestly. Today’s action should help further with this, and the language used in the statement and press conference also highlight an understanding of the importance of the value of the U.S. dollar in influencing global economic conditions.

It's clear that today’s policy stance was a matter of deliberation, compromise, and some contention, as was evident from the two dissents from the policy announcement (Committee members George and Rosengren), and the tension between slowing business conditions and a very buoyant level of consumption, particularly in the services sectors, is complicating the Fed outlook. Indeed, Committee member comments prior to the quiet period indicated a fair amount of division over policy direction, which is not unusual from a longer-term historical standpoint, but during the Greenspan and Bernanke years we became more used to Committee consensus than perhaps can be expected today.

Another concept we think is vital to understand is that the Fed’s monetary policy actions and communications, and the market expectations that derive from them, are perhaps the pivotal point in the broader global monetary policy easing cycle underway. Thus, today’s policy action should be viewed in a global context, as the Fed is essentially easing to prevent global weakness from excessively seeping into relative U.S. strength.

Further, as recently indicated by European Central Bank President Draghi, the ECB stands ready to not only potentially cut rates, but also to add to net asset purchases in another round of quantitative easing. In fact, President Draghi indicated a desire on the part of the ECB to attempt to move inflation above (let alone to) targeted levels. Further, they made their policy position clear, by contending that current conditions required more stimulus. And even more importantly, ECB policy makers expressed a willingness to be flexible and imaginative on unconventional policy, which we think should ultimately help stimulate aggregate demand and corporate investment in a more durable way. Finally, from an investment standpoint, portfolio construction and asset valuations in fixed income, and particularly U.S. Treasuries, will continue to hold a very valuable place in a balanced portfolio today and confirms the distinct dichotomy of managing a portfolio and judging asset valuations this year versus in 2018.