Given what we’re seeing with the the, the strength of this dollar and a Fed that wants to cut rates but can’t quite just yet. Just given how strong the, you know, the data has been, Are we likely to see central banks here are going to have to step up and double up their efforts to really preserve their currencies in some way? Phillip, well, you know, central banks don’t look at the currency in an isolated way. They look at overall monetary conditions, right. And so the currency movement can be helpful or not helpful in, in what you’re targeting in terms of overall conditions. What we have seen in the case of Switzerland, I think we’ll see it in the case of Europe. Central banks can act independently of the Federal Reserve up to a point and we’re seeing that we saw it in the case of Switzerland. We’ll see it again I believe in the case of Europe. But it is, it is also clear that the the global picture which is very much dominated by the biggest economy in the world matters a great deal. And so I think we’re going to be in a in a space where there’s going to be some ability of central banks to act independently. The currency will be currencies will be a big part of assessing the overall monitoring conditions. That’s certainly true when you look at Japan at the moment. But overall it is clear that the the Fed policy path is, is extremely important and and that path is changing in, in light of fragmentation, in light of geopolitical conflicts, in light of service inflation not coming down quickly. And what we’re seeing is we are essentially heading into this environment that we’ve talked a lot about in the in the past couple of months where you have relatively sticky inflation, relatively high rates, higher rates for longer and the Central bank will find it difficult to cut rates as aggressively as people thought only a few months ago. Philip, is that still a safe assumption you think we can make that the Fed will cut rates this year? Well they want to cut rates. I would still think you know one or two rate cuts certainly is is possible but we also can see that the math just doesn’t add up. If you of course you know goods inflation I I continue to think will continue to fall that will kind of lead this expectation into rate cuts. But the service inflation piece looks very, very sticky to me. And so it’s it’s going to be hard to reach the 2% target. And in a sense you you sort of face a trade off. Either you accept that you know you settle on higher inflation above target inflation, which is not something the Fed has acknowledged until now or you end up having to do more work or having to wait longer before you can cut rates. There’s just no, there’s no way to get around the fact that service inflation is proving to be incredibly resilient. And so it’s hard to get back to the to the 2% and and certainly you’re not going to get there if you think you can at the same time cut interest rates aggressively and the market is coming to terms with that. It’s been a long kind of longer term adjustment since the beginning of the year and I think we’re at the tail end of it. But we are, you know, there’s so many things in the global economy right now that are basically pushing costs up, fragmentation, wars, the transition to to net 0, frankly, population growth, demographics, right. So, so many factors across the world basically lead you to a conclusion that we’re going to move into a very different environment relative to the Great Moderation of the last few decades where inflation is going to be stickier, rates are going to be higher on balance and growth is going to be relatively, relatively weak.
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