Catching the falling inflation knife rather than waiting for it to land/SNB cuts, Taiwan hikes/Other good stuff

While Powell seemingly can't wait to cut rates to take some edge off the current levels, at the end of the day, about half the committee wants 3 cuts this year and about half put its dots in for 2, about where we stood before the meeting in terms of market expectations. The real reveal was the 'fairly soon' expectations of tapering QT, though it could run longer and end up at the same place. If there is one thing Powell clearly did not do was push back on the current very easy financial conditions. When he was asked about it, maybe he didn't understand the point of the question, he started talking about the labor market. I think he proved that he'll pay attention to financial conditions only when convenient for him. I will say this, watching gold rip higher (which we remain long and bullish on) in particular is not something a central banker wants to see if price stability is their main goal. Also, the 5 yr inflation breakeven is now at a one year high. 

And lastly on the Fed and other central bankers for that matter, you can just see the seeds being sown for another inflection higher in inflation, just like the 1970's as they don't seem to understand that the inflation battle is ONLY won AFTER inflation gets back to their trend line goal and STAYS there for a sustainable period of time. Right now they are trying to catch the inflation falling knife. 

The Swiss National Bank today thought that a 1.75% benchmark rate was just too much as they think they won the war on inflation as they cut by 25 bps unexpectedly to 1.50%. The president said "The easing of our monetary policy has been made possible because the fight against inflation over the past 2 1/2 years has been effective." And they are confident it stays down, "According to our new forecast, inflation is also likely to remain in this range over the next few years." They cut their inflation forecast for 2024 to 1.4% from 1.9% so REAL rates are basically back to zero if realized.