| Amir Kahanovitz, Chief Economist, Phoenix-Excellence |
“It is not clear whether monetary policy is still effective in influencing inflation, given globalization, the ability to buy online that lowers prices, and the advancement of technology that makes production and consumption more efficient.”
The Fed protocol tried to be balanced, but most of the attention was drawn to the willingness of some of the members to accelerate the pace of reducing bond purchases. From the protocol:
“Fed members see in most cases the high level of inflation reflecting factors that are expected to be temporary, but estimated that the inflation pressures may last longer than previously estimated.”
“Because of the continuing uncertainty about supply chain developments, production logistics and the course of the virus. Several participants stressed that a patient attitude towards incoming data remains appropriate to allow a careful assessment of supply chain developments and their implications for the labor market and inflation.”
| The rise in short-term yields is burdensome
Yesterday’s rise in short-term yields in the US was not reflected in the long-term yields either, as at very long they even tended to decline, which caused the curve slopes to continue to moderate.
Today, the Bank of Israel will publish the combined index of economic activity in the economy in October. But it seems that no matter how much he surprises and where, the bank does not dare to raise interest rates, when he wants to see the shekel continue to calm down.
The writer is the Chief Economist of Phoenix-Excellence. This review is provided as a service to readers only, and should not be construed as an offer, recommendation, substitute for the reader’s professional judgment or investment advice or investment marketing, purchase and / or sale and / or holding of the securities and / or financial assets mentioned or of securities and / Or any other financial assets.