: Bank Research Consensus Weekly 06.11.12

American economy and interest rate strategy: The Inside Scoop on the Action of the Fed
Vincent Reinhart, Chief Economist we, Morgan Stanley
Slower employment growth, deepening of the strains in European markets and a more sombre assessment of the ability of American politicians to lead the imminent financial Cliff make likely mark that the Fed cuts its forecast already warm. This would allow all of justification, that the Fed should launch political action more unconventional by changes in its balance sheet. In view of the Morgan Stanley economic forecasts, we consider a possibility of four to five this trigger is reached by June 19-20 FOMC meeting.
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FX: Stretched positioning risks to counter declining
Morten Helt, principal analyst, Danske Bank
This was to be the week that major central banks, announced its intention to monetary easing more but for the moment, only China has delivered. Thus, where that leaves the FX market? Visibility of growth remains weak and is likely to maintain the volatility in the market as investors try to guess what scenario of growth at a discount. This is in turn likely to keep the beta currencies high bounce, as investors will probably confirmation more monetary easing still adding long positions in those currencies.
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Bernanke reaffirms Outlook
John e. Silvia, Chief Economist, Wells Fargo
"Economic growth has continued to moderate pace so far this year," said Ben Bernanke, President in testimony to the Joint Economic Commission this week. We agree with this perspective while recognizing that many in the market had planned economy to pick up steam as the year progressed. We also agree with assessment of the President reflecting the slowdown of the growth of employment, in part, the influence of the seasonal correction factors and earlier this week in hot weather. Inflation, our second fundamental that defines the framework for interest rates, suggests that the measures of inflation, as PCE index and index of consumer prices, are expected to show slower gains for the rest of this year led to mainly by the low prices of energy and weakened demand in the economies.
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United States - financial partners
Chris Jones, Economist, TD Financial Group Bank
Major central banks around the world have been on the offensive this week, even if only in words. In testimony Thursday before the Joint Economic Committee, Bernanke, President supplié lawmakers to do more to support the economic recovery in the United States, saying: "I would be much more comfortable if Congress would take some of that burden us.". Across the Atlantic, after the announcement of the interest rate remain outstanding at 1%, head of the ECB Mario Draghi chastised makers not to be quite aggressive in the resolution of the crisis in Europe. But all the Governors of the central banks step spoke simply speak. In a surprise move, the Bank of China (popular PCB) cut its reference rate by 0.25 pp for the first time since 2008. The movement comes ahead of a sweep of all the economic data to be published by the Statistical Office of the State of this weekend, including inflation.
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