Macro Briefing: 27 July 2023

* Federal Reserve raises target interest rate 1/4 point to 22-year high
* Fed’s staff is no longer forecasting US recession, says Powell
* New US home sales fell in June following surge in May
* Regional banks show signs of recovery in Q2 earnings
* Investors avoid US consumer firms especially vulnerable to economic downturn
* Global oil demand on track to reach record high
* Is the Fed done with rate hikes? If so, it may be time to buy bonds:

Federal Reserve Chair Powell says US housing market has “a ways to go” before prices cool. “There are many people who have low-rate mortgages and whereas they might want to sell in a normal situation, they’re not going to because they have so much value in their mortgage, which means that the supply of existing homes is really, really tight, which is keeping prices up,” he advised at Wednesday’s press conference (July 26). Meanwhile, the chief economist at the National Association of Realtors says: “The national median home price in June was slightly less than the record high of nearly $414,000 in June of last year.” Yahoo Finance notes: “The S&P CoreLogic Case-Shiller US National Home price index increased by 0.7% month over month in May on a seasonally adjusted basis, up from the 0.5% increase from April. That marked the fourth consecutive monthly increase.”