Episode summary
Bloomberg Surveillance TV: August 20th, 2026 | Bloomberg Surveillance
Bloomberg Surveillance
· · 27 min · Hosts: Tom Keene, Paul Sweeney, Lisa Mateo, Michael Barr · Guests: Mary Daly, Nela Richardson, Mona Mahajan
Summary
The discussion centered on whether the recent rise in long-term Treasury yields is sending a meaningful policy signal or mainly reflecting structural forces such as fiscal sustainability, global rebalancing, and AI-related investment. The Federal Reserve guest said the long end of the curve is not giving the Fed a clear signal for near-term policy changes, and that officials should stay focused on inflation, which remains above target despite a softer labor market. She argued the more important question is whether overlapping shocks could compound and keep inflation sticky, not whether the market is doing the Fed’s work for it.
Key takeaways
- The Federal Reserve guest said long-end yield moves are being driven by structural factors, including AI investment, and do not by themselves justify a policy change.
- The Federal Reserve guest said the July hold still made sense because recent inflation and labor-market prints did not alter the case for waiting.
- The ADP guest argued wage growth has not kept pace with inflation for many workers, especially older workers, and that real-income pressure is still weighing on households.
- The Edward Jones guest said 10-year yields near 4.5% to 5% are the key range to watch, with equities still supported unless yields move materially above it.
- The Edward Jones guest said AI, strong earnings, and a still-resilient consumer keep the equity backdrop constructive even if the Fed eventually raises rates once or twice.
Notable quotes
“I don't see our credibility at risk. I also hear a lot about should we be making preemptive cuts or hikes rather and I don't see a lot of evidence that that's an urgent problem to solve”
“when wages soared, uh pay did not keep pace. And that's because employers, those very employers that the Fed is listening to tend to have structural uh uh permanence in their wage increases”
How the episode opens
Bloomberg Audio Studios podcasts radio news. This is the Bloomberg Surveillance Podcast. I'm Jonathan Pharaoh along with Lisa Abramitz and Amarie Hordern.
Join us each day for insight from the best in markets, economics, and geopolitics. From our global headquarters in New York City, we are live on Bloombo television weekday mornings from 6:00 to 9:00 a.m. Eastern.
Subscribe to the podcast on Apple, Spotify or anywhere else you listen. And as always on the Bloomberg terminal and the Bloomberg business app heading into Jackson Hole in about a week's time and an important speech just around the corner from a so far tight lit Fed chair Kevin Walsh. We'll hear from him in a week's time.
Joining us now to extend the conversation on the Federal Reserve, the San Francisco Fed President Mary Dailyaly joined us for more. President Daily, always good to hear from you. So thanks for making some time for Bloomberg surveillance.
Here I want to bring up the bond market and I'm sure you anticipated I would go there first. The long bond and the rise we're seeing in yields.
President Dailyy, from your standpoint, what signal, if any, do you take from the South for the long end?
Well, you know, when you look at the long end, it is typically driven by structural factors like fiscal sustainability, geopolitical rebalancing, the massive AI investment for this industrial re renaissance, which people are very excited about. And those factors are driving this. The thing that I look at specifically is this is happening across the globe.
It's not just a US phenomena. It's a global phenomena and it doesn't give us a lot of signal about what we should do in the policy adjustments or the policy calibration for the Fed. And there we look at the short end more than the longer end paying attention to the longer end but really focusing on the job number one which is restoring price stability right now.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- economy
- markets
- finance
- macroeconomics
- investment
Companies and tickers mentioned
- ADP
- ADP
- Edward Jones
Watch the episode
Watch “Bloomberg Surveillance TV: August 20th, 2026 | Bloomberg Surveillance” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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