Fed Leaves Rates Unchanged & June Open For Hike
URL: http://www.businessoffinance.com/sni...-open-for-hike
Here are some bulletin headlines from the April FOMC event immediately after the statement's release:
Following our pre-FOMC primer on what to expect during today's April Fed event, the Fed has once again left the Federal Funds target rate unchanged at 0.25% - 0.50%. We managed to cover the entire event live on our Facebook page, and will therefore be posting content from that venue along with some supplementary comments.
By removing emphasis on negative external risks (i.e. volatility in global financial markets, China, and oil prices) and placing new weight on monitoring global developments, the Fed is essentially hinting that while risks have indeed subsided, FOMC members will nonetheless be sensitive to negative surprises across the pond and in Asia.
This essentially shifts some of the attention away from the domestic economy, which the Fed has acknowledged to be on the slow path of growth, and shines more light on other factors, which may or may not include oil prices, geopolitical stability (or lack thereoff), monetary policies of other major central banks, and the like.
This seems to be a sleek trick from the Fed's sleeve; allowing it to maintain its "hawkishly-dovish" posture whilst awaiting more positive developments domestically. Developments such as the thawing of disinflationary headwinds brought from low oil prices, which are of course lagging in nature, and (secular?) weakness in the manufacturing industry.
The market now expects at least a 25% likelihood that the Fed will hike rates during their 15 June meeting, once again back loading the path of tightening.
URL: http://www.businessoffinance.com/sni...-open-for-hike
Here are some bulletin headlines from the April FOMC event immediately after the statement's release:
Following our pre-FOMC primer on what to expect during today's April Fed event, the Fed has once again left the Federal Funds target rate unchanged at 0.25% - 0.50%. We managed to cover the entire event live on our Facebook page, and will therefore be posting content from that venue along with some supplementary comments.
By removing emphasis on negative external risks (i.e. volatility in global financial markets, China, and oil prices) and placing new weight on monitoring global developments, the Fed is essentially hinting that while risks have indeed subsided, FOMC members will nonetheless be sensitive to negative surprises across the pond and in Asia.
This essentially shifts some of the attention away from the domestic economy, which the Fed has acknowledged to be on the slow path of growth, and shines more light on other factors, which may or may not include oil prices, geopolitical stability (or lack thereoff), monetary policies of other major central banks, and the like.
This seems to be a sleek trick from the Fed's sleeve; allowing it to maintain its "hawkishly-dovish" posture whilst awaiting more positive developments domestically. Developments such as the thawing of disinflationary headwinds brought from low oil prices, which are of course lagging in nature, and (secular?) weakness in the manufacturing industry.
The market now expects at least a 25% likelihood that the Fed will hike rates during their 15 June meeting, once again back loading the path of tightening.
- FED REMOVES REFERENCE TO GLOBAL EVENTS POSING RISKS TO OUTLOOK
- FED SAYS LABOR MARKET IMPROVED EVEN AMID SIGNS OF SLOWER GROWTH
- FED REPEATS ECONOMIC SITUATION WARRANTS ONLY GRADUAL RATE HIKES
- FED SAYS HOUSING SECTOR IMPROVED FURTHER SINCE START OF YEAR
- FED TO WATCH INFLATION, GLOBAL, FINANCIAL DEVELOPMENTS CLOSELY
- FED: INFLATION BELOW TARGET DUE TO CHEAPER NON-ENERGY IMPORTS
- FED SEES MODERATE GROWTH, STRENGTHENING LABOR MARKET AHEAD
- FED REPEATS ECONOMIC SITUATION WARRANTS ONLY GRADUAL RATE HIKES
READ MORE HERE: http://www.businessoffinance.com/sni...-open-for-hike