FED: Chicago's Goolsbee Still Sees Rates "Fair Bit" Lower Despite "Sobering" CPI
Chicago Fed President Goolsbee (dove, 2025 FOMC voter) tells the NY Times that the January CPI report was "sobering". While he told the NYT that seasonal effects may have been at play as usual in January, and echoed Fed Chair Powell's post-CPI comments by saying that he would not read too much into a single inflation report, he also said “there’s no question, if we got multiple months like this, then the job is clearly not done."
- Nonetheless, Goolsbee repeated his pre-CPI outlook on Fed rates - that they would end up a "fair bit below where we are today,” though that's conditional on "confidence that we are on path to 2 percent inflation.”
- It would appear that the January inflation data has tested but not completely shaken FOMC doves' confidence in the disinflationary story - Powell didn't express particular concern when asked in Congress earlier (“we’re close, but not there on inflation.”)
- And the only other post-CPI commenter so far - Atlanta's Bostic, more of a hawk than a dove - doesn't seem to have changed his overall rate cut view (in line with the FOMC median, 50bp this year and 50bp next), though he mentioned "uncertainty" as a reason to be less confident, with the latest inflation data suggesting that careful monitoring of conditions is still required.
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US: NATO Approval Of US Leadership Fragile Despite Biden's Multilateralism
A new survey from Gallup has found that the reputation of US leadership remains fragile, across NATO member countries, despite US President Joe Biden’s attempt to shore up the transatlantic partnership.
- Gallup: “In the last year of Biden’s presidency, the median approval of U.S. leadership across NATO’s 30 member countries was 35%, the lowest of his term. Median disapproval was 51%, the highest of his term.
- “Historically, these ratings were still relatively better than those under Trump or during George W. Bush’s last two years in office. However, ratings under Biden were worse than those during most of the Barack Obama administration, when approval averaged 46% and disapproval averaged 26%.”
- The survey suggests, ahead of Trump's return to the White House on January 20, that Biden's focus on multilateral foreign policy has not wholly repaired tensions within NATO, particularly regarding disagreements in policy towards the Middle East and Ukraine.
- The alliance will be tested further in the coming weeks, with Trump previewing a return to his hardline first-term rhetoric on alliance contributions, calling on NATO members to hit 5% of GDP in defence spending - more than double the current benchmark target.
Figure 1: Approval of the Leadership of the United States, NATO Member Countries
Source: Gallup
PIPELINE: Midday Corporate Bond Roundup: Issuance Picking Up
- Date $MM Issuer (Priced *, Launch #)
- 01/13 $2.5B #Standard Chartered $1B 4NC3 +105, $500M 4NC3 SOFR+124, $1B 11NC10 +143
- 01/13 $2B #Deere $1.25B 10Y +68, $750M 30Y +75
- 01/13 $1.5B #CBA 5Y SOFR+69
- 01/13 $1B *EBRD 5.5Y SOFR+42
- 01/13 $1B #Plains All American 10Y +120
- 01/13 $750M #Ares Strategic 7Y +175
STIR: BLOCK: Mar'25 SOFR Midcurve Call Tree
- 10,000 0QH5 96.00/96.12/96.25 call trees, 3.5 net (2-legs over) at 1246:42ET
