WASHINGTON - While the bond market is not ready to believe it yet, some economists are looking for a slowdown in U.S. growth in coming months that could keep Federal Reserve officials on the sidelines.

Other analysts say the case for a more subdued economy is not strong enough yet and that Fed officials will have to tighten rates further in response to rising inflation pressures.

The split views help explain why the bond market remains in a bearish mood, buffeted by uncertainty and worries over inflation despite some recent signs that the economy is cooling.

Yesterday was a case in point, as the National Association of Purchasing Management reported industrial firms in May paid more for a variety of supplies that included paper, chemicals, fabricated metals, and plastics. The group's price index jumped to from 63.2 in April to 71.5 in May, the highest reading since October 1990.

A recent survey of plant managers indicated that industrial companies expect prices to rise only 1.5% this year, but the bond market took at report as fresh evidence that inflation is on the rise.

Adding to the market's worries are widespread expectations that this Friday's unemployment report will show strong gains in May. A healthy jobs report would underscore the view that the economy is expanding at a robust pace of 3.5% to 4% in the second quarter - a notch above the 3% rate recorded in the year's first three months.

Still, several economists who were interviewed yesterday said they believe that U.S. output is starting to slacken and that bond market worries about inflation are overblown.

"I think there's a pretty good chance that things will moderate in the second half of the year, and in that context the Fed's on hold for a while, but the market doesn't want to hear that," said John Williams, managing director at Bankers Trust Co.

"The market is fixated on some of these bizarre inflation indicators, and it is hallucinating about inflation right around the corner. The fact is, if the economy doesn't slow, there will be some inflation soon, but the Fed seems to be on top of its game," said Williams. "They moved quickly and significantly, and we're seeing some evidence that the higher rates are already slowing things a bit."

So far, the economic statistics pointing toward slower growth have been scattered and largely ignored by bond market participants worried about jumpy commodity prices. For example, department store sales in May were off 2.7% according to the Johnson Redbook survey, and there is some evidence that car sales are topping out after a hot spring selling season.

Some analysts expect rising interest rates, which have been on the upswing since last fall, to put a lid on home building and sales activity in coming months. "The housing market is still quite strong, but it's not going to advance from its peak," said L. Douglas Lee, chief economist for Nat West Markets.

According to the Federal Home Loan Mortgage Corp., the rate for 30-year fixed mortgages at the end of May was 8.53%, up a percentage point from a year earlier. Moreover, the pace of home mortgage refinancings tracked by the mortgage Bankers Association has plummeted to the lowest level since August 1991, taking away a major source of cash that many home owners used to support their spending habits.

The main story for the economy has been rapid spending by consumers in excess of income throughout 1993 and into the spring of this year, and "I don't think that can go on forever," said Lee. He is forecasting that gross domestic product in the second half of the year will slip to a range of 2.5% to 3%, which would be the growth path that many analysts believe Fed officials are targeting to contain inflation.

Ray Stone, managing director of Stone & McCarthy Research Associates in Princeton, N.J., is also forecasting growth of 2.5% to 3% to close out the year.

Other analysts remain much less sanguine about the prospects for a softer economy and a stand-pat Fed. On Wall Street, interest-rate guru Henry Kaufman has raised eyebrows with predictions that the Treasury long bond will rise to 9% and possibly 10% before the market stabilizes. And analysts at J.P. Morgan have estimated GDP in the second quarter will soar 6%.

Economists at First National Bank of Chicago have been telling clients that they believe the Fed will have to raise the federal funds rate from 4.25% to as high as 7% or even 8% over the next several years before the business cycle peaks.

However, a progressively tighter Fed would not necessarily be a disaster for long bonds, which have already seen yields rise twice as much as short-term securities, said Dana Johnson, head of First Chicago's market analysis unit. As the yield curve flattens, which typically happens in an aging expansion, a 7% funds rate might bring a 7.25% bond yield, he said.

Chris Rupke, an economist at Mitsubishi Bank, is generally neutral in his outlook for the rest of the year with a GDP growth estimate of 3% - at the top of the range that many analysts say indicates overheating. "It's nothing to really destroy us, but I am still still concerned about the Fed attempting to stay ahead of inflation," Rupke said.

That could mean a long bond yield of 8% before the year is over, Rupke suggested.

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