Macro Comment US — Short-term fiscal boost, but increasing risks

Substantially more expansionary fiscal policy indicates stronger growth for both 2018 and 2019 than in our January forecast. However, the demand impulses from the tax reform and budget deal also increase the risks of overheating. The Federal Reserve will, in our view, respond and raise the policy rate three more times this year. Moreover, we believe that financial conditions will tighten more than households and firms expect. Thus, even if we now expect growth to be maintained for longer, we are still more pessimistic than consensus about the longer-term performance of the US economy and believe that the US will lead the next global downturn.

Fast Comment US — Fed hikes and raises rate outlook for 2019, 2020

1. Fed hikes and raises rate outlook for 2019, 2020
2. Press statement little changed; significantly lower unemployment forecasts
3. USD slightly lower, curve steepens

Fast Comment US — Stellar employment but wage growth declines

1. Payrolls increased 313,000 in February - markedly above expectations
2. Unemployment rate was unchanged at 4.1 percent due to an increase in the participation rate
3. Wage growth declined from 2.8 percent to 2.6 percent, which will take the edge off rate hike fears and support equity markets

Fast Comment US — Fed Chairman Powell strikes a bullish tone on the economy

1. Powell says rates can continue to rise gradually
2. Outlook for growth remains strong, aided by fiscal policy and firmer global demand
3. March rate increase appears to be 'a done deal'; risk of four increases this year is increasing

Fast Comment US — CPI data keep inflation jitters alive

1. Core CPI surprised on the upside with an increase of 0.3% m-o-m; consensus: 0.2% m-o-m
2. Keeps the possibility of more aggressive Fed tightening alive
3. Expect USD and yields to rise and stocks to fall

Fast Comment US — Highest wage growth since 2009

1. Stronger job growth trend
2. Unemployment unchanged but…
3. Watch the wage growth