As we feared, at the end of last week, Fed Governor Chris Waller (determined to kill a repeat of the summer’s easing of financial conditions) drove home a very hawkish message (“Fed: Is it All Over?” 5th Oct). As a result, while there are signs of FOMC cohesion cracking, most of his peers held this line, and once you added in a solid NFP, it was enough to banish talk of a pivot. This has left both bond and equity markets in a very precarious position.
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