This is a feel-good report. When you get a strong growth number and a low inflation number, it's hard to get a better combination than that for the economy.
More Quotes from Ethan Harris:
The main thing holding back the economy in the past year and a half has been a lack of business confidence, and now we're seeing these surveys with a fairly optimistic take on the economy. The non-manufacturing survey certainly reflects the general increase in confidence, and that's a self-fulfilling thing.Ethan Harris
It's much too early for the Fed to be thinking about hiking interest rates. It would be a very dangerous action on their part in this fragile initial stage of the recovery.
Ethan Harris
In an ideal world, three simultaneous gradual adjustments would happen. The U.S. eliminates the budget deficit, China revalues by 30 percent and China works to rebalance growth more to consumption and less to exports. Of course none of this will happen and the pressure for protectionism from Congress grows.
Ethan Harris
I think that (high inflation readings) would be almost the last straw to convince the Fed.
Ethan Harris
With inflation trending up, we believe the Fed will want to stay on the tight side of neutral for an extended period.
Ethan Harris
For the Fed to hike rates now would be the equivalent of a doctor prematurely declaring a patient at full health, discharging them from the hospital and then forcing them to run a mile.
Ethan Harris
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