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The Fed's shift is also benefiting the US consumer
In 2017 and 2018, monetary normalisation by the Fed weighed on household income by increasing the interest expense on credit cards and on auto loans. If the Fed had continued to hike rates, the phenomenon would have been amplified in 2019 and 2020 due to the knock-on effects for the cost of mortgage lending. With the Fed’s 180° pivot, the saving on household interest expense works out to around 0.1pt of GDP. At the macroeconomic level, this is a small impact. But it will benefit ...
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Oddo BHF
Oddo Securities provides securities brokerage and research services. The company offers equity, economic, and derivatives research and credit analysis services. It focuses on insurance, automotive, building materials, pharmaceuticals, telecommunications, information technology, and agri-food industries.
Bruno Cavalier
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