Central Banks

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The Federal Reserve as expected raised rates to 2.25-.50% as Expected after a two day meeting on Wednesday with Jerome Powell as Chairman. Markets had priced in a 75% chance of a 25bp hike. 

 Fed Boardroom

Federal Reserve December FOMC Meeting 

Federal Reserve Announcement Wed 19 Dec 2018 14:00:00 ET  

  • Rates hiked 25 basis points 
  • Vote was unanimous
  • Repeats that risks to the economy appear 'roughly balanced'
  • Says expects 'some' further gradual hikes
  • Says will continue to monitor economic and financial conditions for their effects on economic outlook

Current Fed funds rate +25 bp to 2.25%-2.50% range

FOMC Statement and Press Conference December 19, 2018 14:30 ET

Federal Reserve December FOMC Meeting Expectations

Fed rate Probablities Dec 2018 FOMC

Fed Fund Futures Probablities Dec 2018 FOMC

Federal Reserve November FOMC Meeting Recap

Federal Reserve leaves rates unchanged, as expected Wed 8 Nov 2018 18:00:02 

Fed funds rate held in the 2.00%-2.25% range

Highlights

fed chair powellHighlights: Jerome Powell Fed Chair

  • Fed kept the Fed Funds target range of 2.00-2.25% 
  • Keeps IOER rate to 2.20% effective
  • Still No Accomodative Reference (Removed in October)

 

Federal Reserve November FOMC statement

For release at 2:00 p.m. EDT

Information received since the Federal Open Market Committee met in September indicates that the labor market has continued to strengthen and that economic activity has been rising at a strong rate. Job gains have been strong, on average, in recent months, and the unemployment rate has declined. Household spending has continued to grow strongly, while growth of business fixed investment has moderated from its rapid pace earlier in the year. On a 12-month basis, both overall inflation and inflation for items other than food and energy remain near 2 percent. Indicators of longer-term inflation expectations are little changed, on balance.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects that further gradual increases in the target range for the federal funds rate will be consistent with sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2 percent objective over the medium term. Risks to the economic outlook appear roughly balanced. In view of realized and expected labor market conditions and inflation, the Committee decided to maintain the target range for the federal funds rate at 2 to 2-1/4 percent.

In determining the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to its maximum employment objective and its symmetric 2 percent inflation objective. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments.

Voting for the FOMC monetary policy action were: Jerome H. Powell, Chairman; John C. Williams, Vice Chairman; Thomas I. Barkin; Raphael W. Bostic; Lael Brainard; Richard H. Clarida; Mary C. Daly; Loretta J. Mester; and Randal K. Quarles.

FOMC STATEMENT CHANGES > via @RANsquawk

Source: Federal Reserve

From the TradersCommunity Research Desk

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