It’s the day we’ve been waiting for! Okay, maybe you haven’t been anxiously looking forward to the wrap up of the FOMC’s two-day meeting and learning if they are going to adjust the Fed Funds rate. You must have more exciting things to do! 🤓
It is widely expected that there will be no change to the Fed funds rate during today’s announcement at 11:00 PST. As I write this post (8:11 am), mortgage-backed securities (what mortgage rates are based on) are up about 13 basis points and the Dow Jones is up 221 at 42,436. Markets will be waiting for the Fed’s statement along with the Summary of Economic Projections, which will reveal their forecast for inflation, the unemployment rate and other economic data. This will be followed by Jerome Powell’s press conference, which markets will be watching closely to learn the Fed’s view on the economy and if they feel it’s slowing.
Stay tuned! This is a live post that I will be updating throughout the day.
11:00 AM PST: As expected, the Fed left the Funds Rate unchanged. The Dow is up 130 at 42,346 and MBS are up 11 basis points from the start of the day. Up next, is the press conference at 11:30 PST.
11:37 AM PST: The Fed projects 2 rates cuts this year. “Uncertainty is unusually elevated”. Powell states “Everyone I know is forecasting a meaningful increase in inflation in coming months from tariffs, because someone has to pay for tariffs”.
12:12 PM PST: Dow is the red – down 28.62 to 42,187.18. MBS (mortgage-backed securities) is losing ground and is now up 2 basis points from the start of the day. Powell feels that the labor market is pretty stable unless you’re looking for a job as job creation is lacking and we’re not seeing a lot of layoffs. Powell wrapped up the conference at 12:22 pm.
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