The Fed may do a policy U-turn and slash interest rates as soon as year-end - because a recession almost here, J.P. Morgan Asset Management's CIO says

[kevinUsa]

• The Fed may cut rates as soon as year-end as a recession hits the US economy, according to J.P. Morgan Asset Management's CIO. 
• "The magnitude of the slowdown we're seeing across the board tells us that we'll probably still be hitting recession around year-end, so they'll be cutting rates by then," Bob Michele said.
• Such a move would be similar to how the Fed dropped its "transitory" call on inflation and started raising rates, he said.

 

 

 

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1 of 6 Photos in Gallery©Frazer Harrison/Getty Images

Meet the average American millennial, who's a parent and homeowner with a net worth of $128,000 and hoping for student-debt relief

• The average American millennial is better off financially than they were five years ago.
• Higher salaries have allowed many to grow their wealth and buy homes.
• Under the weight of student debt and childcare, they may still be worse off than prior generations.

This story is kicking off a series called "Millennial World," which looks at the state of the generation around the globe.

Millennials are growing up.

The oldest of the generation, which includes anyone born between 1981 and 1996, is now past the age of 40. In recent years, many have checked off major life milestones including buying a home and having children, and some could even be on the verge of a midlife crisis. 

But getting older has already come with some growing pains. 

Over the past decade — and longer for some — many millennials have faced high costs of housing and childcare, staggering student-loan debt, and the Great Recession's impact on the job market. This trifecta hit older millennials the hardest and continues to have lingering effects.

Despite these obstacles, the average millennial is faring better financially than they have in the past. And while some of this may simply be a byproduct of getting older — people tend to earn more over the course of their careers — some experts have argued that even compared to past generations, millennials are doing pretty well financially these days.

From saving to spending and financial behaviors in between, here's what life is like for the average American millennial.

Editor's note, May 30, 2023: This story was updated to clarify household income versus individual income data.

See More

 

A US recession is round the corner and it may force the Federal Reserve to slash interest rates as soon as year-end, according to the chief investment manager of J.P. Morgan Asset Management. 

In an interview with Bloomberg Television, Bob Michele said the US central bank will likely quickly pivot - possibly before the year is out - from its current messaging that rates will stay high for longer, to reverse policy and start cutting borrowing costs.

 

 

Related video: JPM's Michele Sees US Recession, Fed Cut by Year End (Bloomberg)

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Such an outcome would be similar to how the institution shifted its stance during 2021-2022, when it abruptly abandoned its narrative that inflation was "transitory" and started raising rates, he added.

"This is the Fed that promised us "transitory" and then within a couple of months, changed their mind and started hiking rates. We think we're going to see the same thing this time," Michele told the outlet. "They're going to tell us that they're going to keep rates higher for longer until inflation is at their target.

"But the magnitude of the slowdown we're seeing across the board tells us that we'll probably still be hitting recession around year-end, so they'll be cutting rates by then," he added.

A majority of economists expect the Fed to leave benchmark borrowing costs unchanged in the current 5%-5.25% range at its policy meeting next week, according to a Reuters survey. The monetary authority has already hiked rates by more than 500 basis points over the past six quarters in a bid to tame inflation.

It has succeeded in lowering the annual pace of consumer-price increases to around 3% from 40-year highs above 9% reached last year. 

"I think this time for them to cut rates, they're going to have to see unemployment go up. So it's possible that they may actually tip the economy into recession first before they start cutting rates, which would be something new for them. It would be positively ECB-like," J.P. Morgan Asset's Michele told Bloomberg

[kevinUsa]

The Fed may cut rates as soon as year-end as a recession hits the US economy, according to J.P. Morgan Asset Management's CIO. 
"The magnitude of the slowdown we're seeing across the board tells us that we'll probably still be hitting recession around year-end, so they'll be cutting rates by then," Bob Michele said.
Such a move would be similar to how the Fed dropped its "transitory" call on inflation and started raising rates, he said.
Meet the average American millennial, who's a parent and homeowner with a net worth of $128,000 and hoping for student-debt relief

Full screen
1 of 6 Photos in Gallery©Frazer Harrison/Getty Images

Meet the average American millennial, who's a parent and homeowner with a net worth of $128,000 and hoping for student-debt relief
The average American millennial is better off financially than they were five years ago.
Higher salaries have allowed many to grow their wealth and buy homes.
Under the weight of student debt and childcare, they may still be worse off than prior generations.
This story is kicking off a series called "Millennial World," which looks at the state of the generation around the globe.

Millennials are growing up.

The oldest of the generation, which includes anyone born between 1981 and 1996, is now past the age of 40. In recent years, many have checked off major life milestones including buying a home and having children, and some could even be on the verge of a midlife crisis. 

But getting older has already come with some growing pains. 

Over the past decade — and longer for some — many millennials have faced high costs of housing and childcare, staggering student-loan debt, and the Great Recession's impact on the job market. This trifecta hit older millennials the hardest and continues to have lingering effects.

Despite these obstacles, the average millennial is faring better financially than they have in the past. And while some of this may simply be a byproduct of getting older — people tend to earn more over the course of their careers — some experts have argued that even compared to past generations, millennials are doing pretty well financially these days.

From saving to spending and financial behaviors in between, here's what life is like for the average American millennial.

Editor's note, May 30, 2023: This story was updated to clarify household income versus individual income data.

See More
A US recession is round the corner and it may force the Federal Reserve to slash interest rates as soon as year-end, according to the chief investment manager of J.P. Morgan Asset Management. 

In an interview with Bloomberg Television, Bob Michele said the US central bank will likely quickly pivot - possibly before the year is out - from its current messaging that rates will stay high for longer, to reverse policy and start cutting borrowing costs.

Related video: JPM's Michele Sees US Recession, Fed Cut by Year End (Bloomberg)
For the Fed to pause, we've said for a long
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JPM's Michele Sees US Recession, Fed Cut by Year End
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Such an outcome would be similar to how the institution shifted its stance during 2021-2022, when it abruptly abandoned its narrative that inflation was "transitory" and started raising rates, he added.

"This is the Fed that promised us "transitory" and then within a couple of months, changed their mind and started hiking rates. We think we're going to see the same thing this time," Michele told the outlet. "They're going to tell us that they're going to keep rates higher for longer until inflation is at their target.

"But the magnitude of the slowdown we're seeing across the board tells us that we'll probably still be hitting recession around year-end, so they'll be cutting rates by then," he added.

A majority of economists expect the Fed to leave benchmark borrowing costs unchanged in the current 5%-5.25% range at its policy meeting next week, according to a Reuters survey. The monetary authority has already hiked rates by more than 500 basis points over the past six quarters in a bid to tame inflation.

It has succeeded in lowering the annual pace of consumer-price increases to around 3% from 40-year highs above 9% reached last year. 

"I think this time for them to cut rates, they're going to have to see unemployment go up. So it's possible that they may actually tip the economy into recession first before they start cutting rates, which would be something new for them. It would be positively ECB-like," J.P. Morgan Asset's Michele told Bloomberg

[desiboys]

lot of big car dealerships are in heavy losses right now. This can extend to other sectors if the interest rates are too high. anduke thagginchaali

[Variety_Pullayya]

they will keep it at present rate for most of 2024.