FOMC Apt to Stand Pat, But Future Fissures Emerging

The Federal Reserve is about to hold its second Federal Open Market Committee (FOMC) meeting under its new monetary policy framework amid strange and rapidly changing circumstances. No policy change is likely on November 5. In other words, the FOMC will almost certainly leave the federal funds rate in the zero to 25 basis point […]

FOMC Minutes Show Worry Over Virus Without More Stimulus

The minutes of the mid-September Federal Open Market Committee meeting Wednesday showed Fed Board members and regional bank presidents worried about more intense virus outbreaks and the chance of no near-term government stimulus – weeks before both concerns seemed to be realised. The minutes added almost nothing in the way of fresh insights not already […]

FOMC Doubles Down on Inflation Overshooting

The new era of Federal Reserve policy allowing an overshoot of its 2% inflation target for an extended time launched Wednesday with two Federal Open Market Committee dissents after a “robust discussion.” There were, however, few expectations expressed that even reaching the 2% target would be possible for at least two more years and exceeding […]

Is It Too Early to Care About 2023?

The upcoming week’s key events are concentrated into the middle of the week, with Wednesday’s FOMC meeting the highlight. While it is doubtful that the meeting will produce anything earth-shattering, it should confirm the shift in attention toward improving the employment situation and supporting the economic recovery rather than worrying about inflation bubbling up. As […]

FOMC Preps for New Monetary Framework Era

There was very little chance the Federal Reserve was going to raise interest rates anytime soon but, just to make sure, the Fed’s rate-setting Federal Open Market Committee gave itself a dual justification for holding rates down indefinitely with the new monetary policy framework it announced on August 27. Not only did the FOMC give […]

Status Check: No Happy Talk from Powell: Virus Stats Grim

The following is Wednesday’s status check of developments in the US that can influence economic, health and political outcomes: The VIX mood ring turned a more mellow shade Wednesday, improving a notable 5.27% to settle at 24.10 by day’s end. US stocks finished the day’s session +0.61% or 160.29 points, and in early after hours […]

Fed’s Powell: Probably ‘Long Tail’ of Those Slow to Get Jobs Back

Federal Reserve chair Jay Powell, following a hold-in-place policy meeting Wednesday, stayed away from any happy talk about progress against the virus and unemployment, saying it will be quite a while before low jobless rates return. Referring to the “tail” outside the bulk of the reemployment distribution curve, Powell told reporters in the post-FOMC news […]

The July FOMC and Beyond – What to Expect from the Fed

Even though the US economy’s partial recovery has lately shown signs of faltering in the face of renewed anti-coronavirus restrictions, it would be little short of astonishing if the Federal Reserve’s policymaking Federal Open Market Committee were to announce any new monetary stimulus initiatives at the conclusion of its two-day meeting Wednesday, having already pulled […]

Fed’s Powell: Doing All We Can: Will it be Enough?

US Federal Reserve Chair Jay Powell has offered reassurance policymakers are not even “thinking about thinking” about raising rates and shared his worries about possible long-term post-crisis unemployment. Answering questions after the Federal Open Market Committee reaffirmed that what it’s doing now it will keep doing as long as it takes, Powell acknowledged it’s been […]

Protests Complicate FOMC Statement Amid Recovery

After the May employment report showed slight improvement after the overwhelmingly negative April report, the attention in the week ahead turns to the monthly US inflation reports and Wednesday’s FOMC meeting, as well as the first look at June consumer confidence. The FOMC meets Tuesday and Wednesday at a time that is both the same […]

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