. >> that was fed chair jake powell as you heard there after what our own steve liesman described as a very hawkish pause, the fed projecting two more rate hikes before it's all done chair powell saying all policy makers see more hikes necessary. calling july, a live meeting the stock market selling off almost immediately it's somewhat skewed at least as the dow is concerned by what's been happening with united health it was down by more than 400 points s&p was in positive territory. the market still trying to pars out what the fed chair said. good afternoon i'm scott wapner you're watching "closing bell" at the new york stock exchange jeffrey gundlach will be joining me cameron dawson is here what's the story >> the statement was hawkish the s&p was hawkish. then there was that little window in the press conference where powell wasn't necessarily the most hawkish he's ever been. he talked about how, yes, july is a live meeting, but certainly wasn't committing to it. you saw the market sort of take that with the interest rates coming off their highs for the day. stocks rebounding. th

senior economics reporter steve liesman is a few miles away at the federal reserve with the latest hieve. >> yeah, the pause is expected, but we're on the edge of our seats to see if it is characterized as a skiff, with a long-awaited end to this cycle i don't think the fed knows yet, and i'll explain why powell says rates are sufficiently restrictive that would suggest no more rate hikes are needed but do officials raise their projections, suggest more hikes could be on the way? all that is tied into the economy that supports the idea for the fed to pause for now among the things the fed is trying to gauge are the economic effects of the raising they have done tightening at the banks, and $1 trillion of treasury issuance that could soak up liquidity in the markets and weakness in payrolls that we saw last week and then there was a good part that supported that stance in their march forecast take a look at this. just one official in march forecast below the current level. ten are at the current rate, and seven see more hikes so it won't take much to raise that forecast. so we are watc

steve liesman has the latest results from our cnbc rapid update steve. >> hey, kelly.ping among forecasters for a soft landingç■ in the economy that's one where growth x■ flatlines but doesn't go flatlines but doesn't go negative as previously lpoá■u the first quarter coming in a bit weaker than expected in k■ march, though from march, though it's still above 1%. the cnbc rapid update for the second quarter, that's shaping up to be a percentage pointçó■ higher than march. instead of going negative in the second half of the okyear, gdp seen going up and down around zero but a pretty big upgrade to the third quarter, 0.8%. bank of america writes we revise in favor of a later and softer downturn our forecast is now as much a growth recession as a mildt■ recession. of course, zero growth is not something to be happy about, and economic hardship including potential job losses and there are those whojf aren'tf■ buying soft landing scenario. among those who we surveyed, our recession probability says td a amer ameritrade, it indicates there's a 81% chance of recession in the

let's get straight to steve liesman. steve, for all the biggest takeaways from day one >> hey, kelly, thank you just a few moments allege, fed chair jay powell pretty specifically endorsed the outlook for two more rate hikes, noting that a majority of fed officials had forecast it, and saying it's a pretty good guess if the economy performs as expected, but they're in no hurry to hike rates. >> the level to which we raise rates is a separate question from the speed speed in the early process was important, it is not now now we're moderating that pace >> powell had said in his opening remarks, but still, quote, has a long way to go to get to the 2% target consumer spending had picked up, housing was weak higher rates and slow you output was slowing business investment, but the labor market remains very tight the upshot was little change to the 75-point probability, and -- i'm going to double check that -- a 20% probability of that of a second hike. so the market not necessarily taking them for their word. >>> my next guest

. >> let's talk to our panel gabriella santos, stephanie link, our own steve liesman. let's begin the conversation steve, what a time what a time for a fed meeting. we have the new bull market allegedly started. i wonder what they must be thinking about this as they sit down at the table tomorrow >> reporter: yeah, i'm not sure how happy they would be about the bull market. there's a wealth effect issue. i don't think that's the top of the issues they're concerned with right now i think what happens, scott, is unless you get a massive upside surprise on the cpi report that they take this pause they want to see what they've done i think the chairman has concerns about the banking issues out there i think he has concerns about the effects of policy. they may want to give the treasury a chance to rebuild its c coiffures. he's going to try to dance this dance and say we're not taking it off the table it's not a skip. the skip implies we'll definitely hike. what he said last month was the only forward guidance we're giving you is we're looking at the data they're going to ta

let's ask none other than diana swan, and steve liesman. welcome to you both. diane, is europe playing catch-up they were a little late getting started, if i recall. >> they were late, but i think even the bank of canada, which was not late at getting started and has the beprospects of a soft landing, has resumed rate hikes in the last month, and signaled it's willing to go farther. it's hanging around at too high a level for too lop. they don't want to declare victory until the battle is won. i think that's where we're at. >> you think they will steve, what is the consensus for a hike >> i think there is one. i think this is marginally helpful to the u.s., in that you have other banks raising rates to a point where it's approaches where the u.s. is. if you look at the comparison, we are number one. i don't know if that's the plates we want to be number one in, but we are number one among the developed countries when it comes to rates we were earlier and more aggressive, and our inflation rate is lower. if we have some knock-on effects, i think the bank of engl

steve liesman has all of the details. steve. >> kelly, i think the interpretation is this, for why the economy keeps defying recession fears, look at the fed's flow of funds report just out. household network was up by $3 trillion, driven by equity what you see here is there were declines in real estate value, down by $600, but more than made up by the $2.4 trillion in the increase debt up by 2.2%. the equity that homeowners have in their houses declined for the third straight quarter, but it remains barely above the prepandemic level, showing homeowners have round tripped their gabs -- their gains. so jobless claims, we have to watch it it's just one week's worth of data, but it's been strong employment and equity gains that have kept the economy from that much forecast recession. we'll have to see if this is the beginning of the long-awaited softening of the job market. >> we will have to see i don't know which rabbit hole to go down, because we will dwell on all the data in a moment maybe i should ask you about househol

steve liesman has been digging into the market's expectations in the latest cnbc fed survey. >> surprisingbc fed survey showing our 33 respondents differing with the market and believing the fed scores is none and done. that is no rate hikes at this meeting and no more this year. 91% of the respondents see no rate hike at the june meeting. 63% say july won't see a hike with 34% forecasting a 25-basis point increase the fund reese rate is seen at peaking 5.24%. that's just above the current rate because some do see that july hike. the fed is on hold for a peak rate for nearly eight months >>> more than 80% see no change in september and november. 71% forecast no change in december but a 26% minority are pencilling in a rate cut peter boockvar, chief investment officer of the bleakley group says they will tighten rates one factor that might explain the difference between the survey respondents and the markets is concerns about bank lending. 53% said they would reduce their gdp forecast because of tighter credit standards coming from the bank 47% left their gdp forecast unchanged. but the ave

lean or clean. >> steve liesman, thank you. >>> ahead, the one word every investor needs to know todayl's amy wu silverman lays out how dominant tech might be. we're back after this. not just a weekend retreat, but an everyday getaway right in your backyard. newage makes it possible with beautiful all-weather cabinetry, grills and appliances that transform your backyard into a complete outdoor kitchen. visit newageproducts.com to book a free design consultation and create the outdoor living space you've always wanted. ♪♪ at morgan stanley, old school hard work meets bold new thinking. ♪♪ partnering to unlock new ideas, to create new legacies, to transform a company, industry, economy, generation. because grit and vision working in lockstep puts you on the path to your full potential. old school grit. new world ideas. morgan stanley. '>>> welcome back to "worldwide exchange" and your wrap-up your six stories we're following. longtime diageo ceo ivan men easy zes passes away at 63. >>> china's exports plunged by 7.5% in may far more than expected due to seasonality. >>> tesla's model thr

. >> hold your thoughts for a moment i want to go to steve liesman for some breaking news regarding the fed and household net worth. steve, what are we learning here >> yeah. scott, this goes right into your discussion there about why the consumer keeps on keeping on, why the economy does as well household net worth in the first quarter according to the fed up by $3 trillion driven by equity gains. debt was up a modest 2.2% in the quarter. here is the thing. the value on stocks held by households on their balance sheet up by $2.4 trillion in the quarter. real estate declined modestly, down by $600 billion more than made up by gains in the equity portfolios. equity in real estate which is the percentage of the real estate owned, it was down for the third straight quarter as well it's still above the prepandemic levels people have held on to that surge at least so far in housing gains. government debt up 4.5%, rising sharply. business debt up 3.8 house how old assets and money markets also up by $300 billion to a record $3.3 trillion, the biggest increase since the first quarter of 2020.

steve liesman joins me now with that story >> hi, jon the big upside surprise in the jobs report didn't have markets price in a june height which is what some might have expected and there's a 70% probability that the fed pauses and what it did change was the market's implication for rate cuts this year they have been priced out before the jobs report, fed funds futures had seen at least one rate cut by december putting the year-end funds rate at 485 and after the number suggesting the fed would remain around current levels until the new year. the result, the gap between where the fed expects to be and where the market thinks the fed is going to be is near nothing and it had been a hundred basis points and last month, it's just now eight basis points and among the reasons for the change you have the stronger economic growth in the jobs report and stubborn inflation that won't be helped, by the way, by the port shutdown and higher oil prices and the rebuilding coffers, some estimating to sell a trillion dollars in bills and putting an upward pressure rates and meanwhile, while a pause is

expectations that could factor into the fed's next move we turn, of course, to senior economics reporter steve liesman with more. hi, steve. >> kelly, by thursday investors will have a lot of new information on consumer, the fed and the job market, tons as you say and it will set expectations for the month ahead and here's what wall street forecasters think will happen. they're not always right, but here's the consensus inflation cpi headline dropping and that's a big drop from the 4.9 we had last month and ex food and energy that's the sticky part still down two ticks and still at a high level of 5.3% to maintain the fed's concern. the fed expected to skip and hint of a hike talking about a hawkish pause or a hawkish skip there and the ppi comes, as well and thursday we'll watch jobless claims closer than usual and we had the pop last week of 26 and expect it to come down and more tame this week and there was talk of a seasonal adjustment issue and it seemed down a tick, a tenth of a percentage point from the 0.4% rise in the prior month, but take out autos and it looks a little bit better if you tak

dan's oexplanation spot-on, as well >> let's go to steve liesman you've been listening in on our conversation, steve, what -- what did you make of his comments today >> i think you guys have it exactly right. he fairly explicitly endorsed two more rate hikes in day one of these two days of cong congressional system he said fed officials have for forecast two more. and he said it's a pretty good guess the fed is going to be hiking more. >> they do believe it will be appropriate to raise rates in a big majority believes raise rates twice this year, and, you know, i think that's a pretty good guess at what will happen if the economy performs about as expected >> powell exfa sized the fed's in no hurry to hike at its sequential meetings as it was doing back in the summer the speed is now less important than the level, he said. he said inflation has moderated somewhat, but still has a long way to go to get to the fed's 2% target on the economy, he said it's slowed significantly since last year, but expanding at a modest pace consumer spending picked up, but housing is weak. higher rates are slowin

the fed's next few moves up for debate traders betting on a pause this month and a high in july steve liesman with the latest expectations for the fed steve? how are they looking >> they're changing. the pause or skip in june remains priced in. but the surprise in the friday jobs report was price out rate cuts by year-end, before the jobs report fed funds future had seen at least one rate cut by december, putting the year-end rate at 4.85%. now it's over 5%, suggesting markets see the fed holding at that level at least through year-end the result, the gap between where the fedex%s to be and where the market thinks the fed is gg going to be, it was 100 basis points last month, now just 16 so, never mind the gap, we might say. among the reasons for the change, obviously economic data has been coming in stronger. jobs, inflation's been more stubborn and the treasury is rebuilding its coffers after the debt ceiling debate some say they need to put a trillion dollar in bills out into the market. while a paused is priced in for june, a 62% chance of a july h hike is out there. the question is, stoc

steve liesman, senior economics reporter the a.i. -- i sense some skepticism in steve's voice when he was talking about the a.i. bubble, but if you are a believer in the spending cycle, this spending cycle will defy what is happening in the economy. and maybe that's why we're seeing nvidia do well today, for instance >> well, i'm not ready to make a call on the spending cycle nvidia showed -- >> making a call on the spending cycle -- sorry to interrupt. making a call on the spending cycle is actually admitting that a.i. whether have an impact in terms of productivity and so therefore has to be a factor in the fed's forecast >> that's fine on a day when semiconductors got to all-time highs, a rounding error, i don't believe you're going to have a tech cap-x spend that warrants the kind of move that we've seen in a lot of these semis. i think nvidia can go higher and the valuation there is som something, i think we all have to question what, you know, how we're valuing a company that's growing that fast, especially on peg ratios, which don't look expensive, but i don't think that tech i

to steve liesman with more on the fed. uys, before we talk about powell just a couple new fed comments here from federal reserve governor bowman. she says additional rate increases are necessary to bring inflation down to target and we need sdrooesz achieve, quote -- increases to achieve a restrictive stance on monetary policy and talks about a meaningful and durable decline in s inflation. remains far too high core inflation has plateaued since fall of 2022 that goes with hawkish comments from waller overnight and really goes along with basically developed nation central banks ex-japan all en route to hiking different paces of hike, but the direction of policy around the world essentially is for tighter policy none of the banks, especially those banks that have just inflation andates, are happy with where they're at and they could be going higher and we saw with the bank of england, higher at a faster pace we talked about the boe raising possibly 50. >> yeah. we did did you get anything out of the powell comments that made

steve liesman has more on this front. steve, gosod morning >> good morning. government's checking account at the federal reserve. here's where we now stand. just about $50 billion in the account from just under $1 trillion last year, that's as of last wednesday and now the treasury plans to build it back quickly, which is causing concerns about a liquidity crunch i talked to rick reeder er yesterday saying this. he was among those breathing a bit easier when the treasury said it would sell $425 billion of bills by the end of this month, not the estimated $550 billion out there on the street. but that's still a lot of change right there, and several banks continue to estimate a trillion dollars of short-term issuance by the end of september. the key is whether this goes smoothly is money market funds, which have parked more than $2 trillion in the fed. they earned 5.05% right there. if they use this money to buy the treasury bill markets, markets shouldn't feel much pain at all if they don't, and instead it's funded with bank reserves, that's where people get

steve liesman joins us now to break it all down. feel like data dependent might still be something that we'll be hearing about, steve, hopefully. >> i think we are. i think for sure and, joe, can i add that andrew is 100% right about the chips. >> i'm telling you, eat somos. i cannot even get over these chips. >> what does hearty mean >> they're thicker. >> are they not fried? >> they're whatever they are i know this is not what i came to talk about, but i can -- >> they're outrageous. >> there were reasons to fly delta rather than american airlines from washington because the cava is in the delta terminal >> you're kidding? >> yeah. anyway, i got the one minute thing. let me do this, because i want to talk about considerable criticism this morning that is out there of the fed's pause but the forecast for two more rate hikes the fed is once again getting inflation wrong says miller tabak. ian sherrod son says the shifts in the forecasts and dots are more hawkish than we expected. and over at mufg, the fed runs the risk of solving one

joining me for the hour today joe terranova, kari firestone, jason snipe, steve liesman is with us as well. i'll show you what the markets are doing. we're largely in the red across the board. yieldsr as the fed chair was speaking i guess on that note, steve, to me this sounded like a fed chair justifying his latest rate hike not one who just paused. >> yeah, or certainly justifying the next rate hike that may come through, scott an interesting way to put it more certainty in his talk and the words that he used that rates are probably going up in the july meeting i don't see very much change in the feds market, still a 75% chance of a rate hike. the market has refused since that projection came out to price if that second hike. a little bit of a probability on that he said it's not really important the speed with which we get there now it's the level and getting the level right. in no particular hurry they were on hold to look at the effect of prior rate hikes and to assess the impact of credit tightening but did lean forward. a lot of questions about new banking regulations. republic

. >> i think investors are betting on a few cases steve liesman said they are betting on a pause in july the central banks and the pce report and the jobs report. in the between time, i know you are a person to see a pause, what is the report that we could see to give us insight into july >> i think the next jobs report is essential you know, a lot of the reason people think the fed will stop is hiring has been strong. we have seem jobless claims tick up if those are the signals of what is happening is the weakness in jobless claims, the fed will feel confident in this is not just a pause, we're done if, on the other hand, job gains continue and so vast and rapid and strong, then the fed will have a hard time saying this economy has slowed down and we could feel confident inflation can come down. >> we are talking about shelter and food, jeanna, and experience spending how does that impact the fed decision both tomorrow and in july >> this is a small portion of inflation. it is relevant portion of that super core index that the fed is watching closely the services excluding housing and e

surprise interest rate hike from the bank of england the surprise is they went 50 basis points steve liesman on that decision, steve, which comes on an interesting day when we've had hawkish comments and move globally now we find ourselves in this place where central banks are taking it at different speeds. >> eah, you know what's interesting to me, sara, i don't know if you're getting the same commentary but people are a little angry with the backe of england and the central banker over there, the governor, mr. bailey i think the reason is because nobody likes to be surprised the only reason central banks should surprise is for effect. in other words f there's some reason to jar or shock the market to make sure they know you're serious is to come in jpmorgan is coming in, hey, maybe we don't understand the boe's reaction function and maybe it's time for the boe to be a little more clear about why they might raise 25 or why they might raise 50 nobody likes to be surprised what is happening generally, sara, is central banks around the world are raising rates, but at different speeds. and i th

decision on interest rates comes 25 hours from now are we still expecting a skip or pause for good steve liesman the latest fed survey hi, steve. >> yeah, we have surprising results in this survey, showing our 33 respondents no rate hike now and no more this year is the expectation 63% say the fed won't hike 5.24% is a bit higher, because some see that july hike. here is how the rest of the year should shape up according to the forecasters. more than 80% see no change in september and in november. 71% forecast no change in december but 26% penciling in a rate cut. the chief investment officer writes -- >> credit tightening from the banks and decelerating housing inflation will keep the fed on hold, and that is one factor that could explain the difference in this survey and the markets. the concern about bank lending, 53% are reducing their forecast because of those tighter credit standards. 47% have not but the average deduction was 0.3% that's a lot of gdp. many think the fed should still keep raising rates, saying, we are looking for a hawkish skip we believe the fed will take a break hiking r

steve liesman has the results. good morning. >> good morning, carl.and, of course, a prediction for recession, respondent to the cnbc fed survey think the market could be in for a sell-off before a bounceback next year the average year end s&p call among the 33 respondents is for 4075, 6% below yesterday's close. the s&p bouncing back next year to 4456, a 2.5% gain from current levels respondents who included economists, strategists and fund managers see the market overpriced relative to earrings and economic growth. 71% say equities are somewhat or extremely high and 26% say they are about right. notice nobody saying they're cheap. douglas gordon writing having navigated the debt ceiling and near term banking sector risk capital markets should pivot to recession risks as a result of the risk-reward we have deployed an initial tranche of underweighing assets a plurality are excited about artificial intelligence. 48% say it's a real development that promises significant returns and important changes to the economy. 33% say it's too soon to tell. 9% cal

bring in steve liesman and get his take on the numbers and what's means for how the fed is thinking aboute second question, david, is nothing. right. if you look at what happened to fed probabilities, they were unmoved, unchanged, unremarked when it came to the issue of fed probabilities. i'm looking right now, 70% probability of the fed not doing anything and a 60% it hikes again in july. i am surprised by the strength of all this and how much this has remained the same. i think it's because you have offsetting factors the unemployment rate did tick up that was something, perhaps, for the doves to speak for a pause, but the trouble, of course, is what you see when you look at the unemployment rate, it goes up, it goes down we intended when we had because of the strength of this job market, had a large number of unemployed they tend to go back to work. wages have been kind of stagnant here i think where we're at, it's not a bad time for a pause and maybe a pause for financial reasons because of what's happening in the banking credit and the need, of course, for the treasury to rebuild its

appreciate it >> now to some new comments from atlanta fed president raphael bostic let's bring steve liesman in for those details. hi, steve. >> actually, two fed presidents weighing in with a more dovish outlook on rate hikes after testimony by jay powell suggested the fed may raise interest rates two more times. bostick saying in an essay he just released he's putting himself firmly in the wait and see camp when it comes to raising interest rates he said the fed should let rate hikes work through the economy, see if they bring down inflation before deciding what to do next. good reason he said to expect policy tightening to be more effective in coming months the real effects of tightening, quote, are only just beginning to take hold chicago fed president austan goolsbee, while powell was speaking, saying he had not decided what to do in july but that it was reasonable for the fed to be on a reconnaissance mission now. he agreed with bostic that the fed had raised rates a lot and those rate hikes needed some time to play out in the economy. he indicated he wanted several more months of data

more on the retail trade ahead >>> philly fed president speaking now steve liesman has the headlines. >> thank you very much, kelly. he's saying we're close to the point where we can hold rates in place. yesterday, he talked about skipping, saying skipping was not holding. but today he is talking about holding rates. he says there are promising signs the fed rate hikes are working. the economy remains healthy amid those rate hikes and expects inflation to fall to 3.5% this year, and 2.5% and meet the target in 2025 unemployment will rise to 4.4% this year, a full percentage point higher i want to look for purposes of the conversation we are about to have, at the probabilities you can see here we have flipped on a dime this week. we started off 70/30 in favor of a cut. we're now in favor of a hold we have pushed ahead you can see that there is a 40% probability there when it comes to the possibility of a hold and then 47% for a hike and 13% looking for 15 basis points, so we'll see if that remains the case after harker speaks and the other folks have been out there. >> so harker's hold

moments here >>> but breaking news out of the new york federal reserve and for that we go out to steve liesman who has the latest >> some guardedly good news out of the new york fed and their survey of consumer expectations. one year ahead inflation expectations falling 0.3 percentage points to 4.1%. that is the lowest in two years. and i can tell you this is not about just gas prices. some of the higher end or more inflationary things like medical care and college education, those fell and responsible for the decline. but not all is good news because long time inflation expectations, the 3 and 5 year both went up you can see the chart there. and the problem is that both are sticky and long term the fed really caress about the 3 and 5 year inflation specexpectations nose house earnings fell a bit. but job confidence, highest level since we've seen since april 2022 and we measure that by looking at the probability of losing one's job, it declined 1.3 percentage point to 10.9%. so still some pretty good numbers there. at least when it comes to the economy. and also inflation near term that makes

ahead of the possible hike in july steve liesman has more from our cnbc survey with shifting predictionsf a recession. >> this has been an interesting one. i'm calling this the recession, one we keep waiting for but never comes. the latest cnbc fed survey, an average put 54% probability on rye session, down a couple ticks from last survey but still the average. quite elevated that risk of recession. the average month for the expected start, it keeps changing in december 2022 it was june that the recession was going to start. in march it was september. the current survey pushes it ahead again to november of 2023. the reason, of course, the unexpected strength in the economy in the first half of the year let me show you the quarterly data here. first quarter came in actual 1.3% it had been forecast as low as 1.2% the second quarter at 1.4% is now the forecast it had been previously forecast as low as minus 0.6% you can see the forecast for the recession in the future. those future quarters start to flat line, minus 0.3%, 0.2%, and positive 0.1%. perhaps expressing the exasperation of many

steve liesman joins us i thought we settled on a skip, steve. >> we did, we did. >> can you also in yourll be just one man's opinion, but tell me what about that number on friday, whether it was the 3.7, the increase in unemployment or whether it was some of the wauge data, what do you think was really responsible for 700 points in the dow after such a strong number what was the nuance that did it, in your view >> you know, joe, i would just as soon throw that back at you i mean, why and when the stock market moves is -- you're smarter about that than i am >> you want my fantasy we don't have a recession, we don't go to 5% unemployment and this is my fantasy inflation moderates but we stay -- we don't hit a recession. we don't need to induce 5 or 6% unemployment, we keep strong, wage prices ease and we get the best of both worlds. >> what i want to know is if the stock market today or on friday is aware of sort of how the market for the fed changed because what happened is the beat on jobs, just as you said, joe, it didn't price in a hike for june as you might have expected what happened

it on the show for awhile, think about the two tens for example we had a conner have sags with steve liesman last night, not necessarily as important as other spreads, but since we're talking about it, here's an inversion that went from flat toll 1.1%, back to 40 basis points and now we're either side of 1%. over a year now, we've been inverted historically, that's not a particularly good sign and one has to ask themselves, how does this resolve itself i won't be pretty when it does so to me, it's a tremendous headwind that the market's not taking into consideration. >> it is, but before we get to our guest, lorlori, i want to a you about the vix. we're sort of come play sent, as a whole, in the market, beside what we're seeing, perhaps, in the bond market and beside what we're seeing in some of the financial stocks >> the vix, it was interesting to me when the vix was above 25. that's typically a buy signal. but you worry about complacency setting in i have other things i look at, as well. the net bulls have been at 20%, over 20% for the last two weeks. once that starts to hit a four-week a

steve liesman is like what are you doing?ms the way they are and zip recruiter warned a couple months ago that activity could be way worse but they're not picking it up in the government data yet. >> yeah, just a little messy here trying to get that toothpaste back into my tube here it doesn't really seem to go >> no. >> i'm not sure what you're -- here's the thing the job market, at least in the measured numbers we're getting, and the stuff we've been reporting. and the jobless continuing claims below 1.8 are mortgages, psychological. it seems to tell you the people losing their jobs are not on continuing claims. they're going back to work, it would appear, relatively quickly. and i am not at the moment concerned about the productivity numbers. let me explain why i don't know if but if you look at the -- oh, they're so good there. that i can a look at that line to the left there before 2020. try to draw up in your mind if it continued upward like that. we would just about hit where we are right now. is that clear to you guys

. >> can they get rid of the range, go back to one single number let's go steve liesman with the fed decision. >> the federal reserve pausing but raising the median forecast of the rate to 5.6%, indicating a hawkish e hikes this year. i think this comes under the definition of a hawkish pause, maybe a very hawkish pause fomc statement saying it is holding the target rate steady, allowing it to assess additional information, including the cumulative effects of tightening and lags of monetary policy. i want to go through in detail here the summary of economic projections and the funds rate only two members of the committee are forecasting the rate at the current rate of 5.13%. for support, one more hike, nine or half of the committee is forecasting two more hikes, but there's more, because two are supporting three hikes and one supports a full percentage point higher or four quarter point hikes in the funds rate. the committee sees more inflation this year than it previously did, forecasting a 3.9% core rate versus 3.6% in the prior economic predictions in march and less unemployment,

steve liesman is standing by with those numbers steve, what do you have for us >> it looks like they'reth of may. april had been -- is down 2.9% i'm just double checking these numbers, because we're looking for 1.4 and change it looks like it's 1.6 for the month of may let me just see if they revised april to 1.34, it looks like -- so they did revise down april. but there's a huge beat on this. i'll figure out how it happened here single-family starts up 18.5% to 997. multi-family up 27%. i've got to make sure i'm reading the numbers right here these are big pop in these numbers. permits up 5.2%. there's been a lot of talk -- i'll stop reading the numbers and tell you the context is that maybe housing in this cycle has bottomed i don't know if i want to make too much of these, but this doesn't seem like a housing sector that's weakening as a result of at least new housing, as a result of these high interest rates that are out there. and maybe it's a result of that. in the sense that existing homes are getting harder and harder to buy. and so people seem to be turning to new homes as a w

steve liesman joins us now with a story on what the technological leap could mean for the federal reservening, joe, yeah you probably remember, but probably not all of our viewers remember netscape launched the ipo in 1995, a few months after the fed completed cranking up interest rates by 300 basis points they hit a level north of 5%, just a bit above where we are right now. all that raises the question about what impact higher rates could have on new investment in ai is this a tech bubble redux that the fed should lean against? justin wofford says if i was jay powell, i would have a whole unit in place now thinking about this stuff he's just one of the guys that has been thinking about what it all means for the economy. back in 1995, high rates didn't have much effect and netscape ipo launches this massive investment that lasts for a half a decade, and culminates in pretty good technological and economic progress, but also one of the great investment busts of all time at the fed had to address. hedge fund investor glen hutchins sees real potential for companies and investors, but he poi

our senior economics reporter steve liesman joins us right now with the market outlook for rates andt is finally done hiking what do you think, steve >> i want -- you want to talk about golf, becky? >> nope. >> no, okay. >> i do. i do i do i do >> good, well, anyway, here's what i want to talk about. fed chair jay powell, he used to like to use this term policy being, quote, in a good place. not a terrible description of where he may be now relative to how the market is priced the fed fund futures show a 92% probability of a pause, probably where he wants to be that's up from yesterday after a report that was more or less in line 65% probability of a july hike, which is a bit high, but lower than yesterday and, of course, there are no more cuts priced in for 2023 and that is, again, in line with where the fed is those kind of numbers give powell the option to pause and make decisions many meeting by meeting while taking stock of several economic developments that are out there here are the things that i think he wants to gauge the impact of. 500 basis points of rate hikes, credit tig

after 10:00 eastern was the dollar index becky, back to you >> rick, thank you let's check in with steve liesman picking up interest these numbers, as rick was just pointing out that march from what we see with the jobless claims to continuing claims >> rick, gave me a good curtain r raise right there. we now have let me count it, one, two, three weeks in a row where we've had this step up from 230 a week to 260 i think we can call it a trend i think at least on the front end of unemployment we have some softness there, some gathering softness, something definitely worth watching remember, though, that the continuing claims is a week behind but what we're not seeing is an increase in continuing claims the appearance -- we infer this from the data, we don't know it definitively from the data, is that folks seem to be going to unemployment, jobless claims and seem to be getting work relatively quickly or the people who are on continuing claims before are getting work. so we're not seeing this increase in continuing claims. maybe it's something that catches up later because it does lag by a week. b

steve liesman is looking at that angle. steve? >> it's interesting, sara. launched a few months after the fed had completed cranking up interest rates by 300 basis points. they hit a level north of 5% right around where they are today. that raises the question what impact higher rates could have on new investment in in a.i. and is this a tech bubble reduction that the fed should be thinking about leaning against. the trurkt of the economy could change in important ways if i was jay powell i'd have a whole unit in place right now thinking about this stuff he said about equality the netscape i.p.o. launched a massive investmentment that lasts a half decade. and, of course, one of the great investment busts of all time hedge fund investor glen hutchins sees potential in a.i. technology but he points out this is the third tech hype cycle after big data and crypto. when it comes to the impact on rates he tells me, for the moment, hype trumps rates. folks will pile in despite higher interest rates. confusing effects from a.i., among them more demand for capital m

let's goat steve liesman who has the latest cnbc rapid update on the economy. steve? >> yeah.ft landing and tentatively a consensus developing among forecasters for a soft landing in the forecast, that is one where growth flatlines but doesn't go negative. the quarterly forecasts in the rapid update coming after last week's retail. first quarter coming in a bit weaker than expected in march above 1% but the rapid update outlook shaping you to be a percentage point higher than the march forecast and instead of going negative in the second half of the year, gdp has seen pretty much flatlining that's not the right chart there. maybe we'll get that up in a second the third quarter was negative and now it's positive about 0.8 move there's the chart. thank you very much. there's the second quarter quite a bit stronger bank of america writing, quote, we revise in favor affiliater and softer down turn our forecast is a growth recession as it is a mild recession. bofa had forecast second half growth averaging minus 1.5%, now sees it down a quarter percentage point the big change, labor

. >> as carl said we're a few moments away from q&a with fed chair powell let's bring in steve liesman at stake here? >> i think setting up for what happens in july, the market, at least the fed funds futures market took it in a neutral way. the market is not pricing in the second hike right now, david he gave a little bit for everyone in the sense he says inflation is too high but also noted pause or maintain didn't use skip or pause. he also was remote from the first thing he said, he said the committee all voted that further rain hikes, but the idea of whether or not there's one or two more is dependent on the data so i think a little bit more drilling down hopefully by the congressmen and women about what it would take to get the second hike in place would be interesting today. >> i thought it was interesting what happened in the uk bond market after the inflation numbers came in hot this morning, steve we got a terminal rate in the market priced to 6%. i know in the uk they're below 5 still. i wonder how correlated we are with the global inflation numbers and how much investors sh

steve liesman has the details on that steve, anything shocking >> nothing shocking.ly all flmc participants believe it's appropriate to raise rates and he said the hold allows -- notice he not using the term skip or pause there. the federal will make decisions, he says but there's still a long way to go to get it back to the fed's it% inflation target he said it will require below trend growth and some softening in the labor market. ho said it will he said it's slowed significantly from last year but is now expanding at a modest play pay and slowing outputt grot are slowing business agreement persian gulf there are some signs that labor and play the wage growth is showing some signs and often repeated phrase from about that were exposed in the failure of silicon valley bank and part of a the about thor poe frm. >> i guess steve, maybe if there's anything that would prize marcus, it would come as part of the q-and-a sections any speaks, we listen closely. >> yeah. it's railroad i don't know that powell is disappointed or they do have a and there is no second hike buil

i think there is actually if you talk to steve liesman, we will have more of an expectation of rate hikesthink the reason it is not baked into the cake is if you look at the last six months. microsoft is up 58%. t the nasdaq is up 31 if there have been modest gains given what happened last year, i would say it is baked in there has been a little bit more optimism the market is clearly making this case that we have one more rate hike. in some ways, it is splitting hairs. i'm optimistic of where the companies are going. i think we will get a pull back. i do ultimately think by the time we get in front of the last rate hike next year, it will be a great year for the companies >> two things, gene, you talked about a pull back in tech. if the idea is if you don't have cash in or cash on the sideline, you would wait w why are you waiting? let's not group them together and call them tech pick two or three stocks you like. >> the two i would pick is google and apple in terms of google, in new york, met with investors the message is they don't see google as an a.i. company. the company having sign

. >> steve liesman joins us right now with his reaction to the numbers. i think the market is trading in a logical way what i'm seeing is a firming up in the sense of a pause this month, but an increasing bet on, and i'll just double that check while i'm talking. sometimes there's a lot of volatility right around the number an increasing bet on the idea of a hike in july, which is now at 68%, or 66%, i guess, is the way to put it. and we're not dpgetting the help from housing one of the expectations of those, you would think if inflation is going to fall is the idea that housing inflation will cool off. i haven't had a chance to see many of the other details in there. you did get a negative number on real earnings. that will be something of a drag on the economy and then when i look at some of the other data here, it looks about, i would say, you know, a good enough -- you can tell whatever story you want out of it in terms of -- i'm not saying it's a dovish number or a hawkish number pretty much has expected a little bit hotter -- >> you see the nasdaq d

we want to get straight over to our senior economics reporter, the professor steve liesman joins us now, steve >> big week, big week, andrew. by thursday investors are going to have new information on inflation, the consumer, the fed, and the job market that's going to set expectations for the months ahead here is what wall street forecasters think is going to happen here, tuesday the cpi comes in 4% is the headline forecast, and that's down nicely and sharply from the prior month at 4.9, but the core you can see remains high and is expected to come down much less just 5.3, looking closely at that core services, which is what powell's watching. on wednesday you get the ppi also, but also the fed meeting with a skip expected and maybe a hint of a hike people are talking about a hawkish skip or a hawkish pause, and i put jobless claims on there, usually not a huge one but given the surge we had last week, we'll be watching it closely. 248 is the number, expect it to come down. retail sales down a tenth of a point from a healthy prior month, but a bit better if you take out the auto sector