JP Morgan on the 'stealth stimulus' supporting the US economy even after rapid rate hikes

JP Morgan on the US deficit and how its supporting the economy. Main points from their note:

• The FY23 deficit is tracking about US$1.5 trillion, but only thanks to the odd accounting of student debt forgiveness
• Excluding student debt, the deficit would be closer to $1.8tn, and almost $1tn larger than in FY22
• This widening should partly reverse as we move into FY24, when we project a deficit around $1.6tn
• This year's "stealth stimulus" may help explain the economy's resilience to rapid interest rate hikes

Has the Federal Open Market Committee (FOMC) done enough now?

• Forexlive Americas FX news wrap 26 Jul: Fed raises rates by 25 bps to 5.5%. 22-year high.