The Fed finished up Janet Yellen’s last meeting today, and while, as expected, there was no move on interest rates, the post meeting statement reflected a positive view of growth and (rising) inflation, and the will to move the policy rate higher multiple times going forward.
That, along with the following chart/commentary on wage growth, supports our “the bond bull market’s days are numbered” thesis. And a new normal (with its attendant crosscurrents) the stock market will have to contend with:
click to enlarge
A tighter labor market may finally be starting to show up in Americans’ wallets. Total U.S. employee compensation rose in the fourth quarter and matched the biggest 12-month gain since 2008, as private-sector pay picked up, according to Labor Department figures Wednesday. Several industry groups registered wage increases of 3 percent or higher, including transportation and services such as leisure.
Bloomberg