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The Federal Reserve as expected kept rates  at 2.15 -.50% as expected after a two day meeting on Wednesday with Jerome Powell as Chairman. Markets had priced in a 0% chance of No hike. Says Labor market remains strong and Inflation has declined largely due to energy

 Fed Boardroom

Federal Reserve December FOMC Meeting 

Federal Reserve Announcement Wed 20 March 2019 14:00:00 ET  

  • Rates unchanged 
  • Vote was unanimous
  • Intends to slow balance sheet runoff starting in May and ending in September provided economy evolves as expected
  • Says economic growth has slowed from solid rate in Q4
  • FOMC dot plot shows no hikes in 2019. One hike in 2020 Labor market remains strong
  • On average job gains have been solid
  • Indicators point to slowing growth in household consumption and business investment
  • Inflation has declined largely due to energy
  • Market based measures of inflation expectations remained low
  • Survey based inflation little changed

Current Fed funds rate 2.25%-2.50% range 

The Federal Reserve 'Dot Plot' signaled no more increase in interest rates in 2019 and just one in 2020. The Fed still sees rates peaking at 2.8%, but not until after 2021.

FOMC Statement and Press Conference March 20, 2018 14:30 ET

March 20, 2019 Federal Reserve issues FOMC statement For release at 2:00 p.m.EDT

Information received since the Federal Open Market Committee met in January indicates that the labor market remains strong but that growth of economic activity has slowed from its solid rate in the fourth quarter. Payroll employment was little changed in February, but job gains have been solid, on average, in recent months, and the unemployment rate has remained low. Recent indicators point to slower growth of household spending and business fixed investment in the first quarter. On a 12-month basis, overall inflation has declined, largely as a result of lower energy prices; inflation for items other than food and energy remains near 2 percent. On balance, market-based measures of inflation compensation have remained low in recent months, and survey-based measures of longer-term inflation expectations are little changed.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. In support of these goals, the Committee decided to maintain the target range for the federal funds rate at 2-1/4 to 2-1/2 percent. The Committee continues to view sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2 percent objective as the most likely outcomes. In light of global economic and financial developments and muted inflation pressures, the Committee will be patient as it determines what future adjustments to the target range for the federal funds rate may be appropriate to support these outcomes.

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; Michelle W. Bowman; Lael Brainard; James Bullard; Richard H. Clarida; Charles L. Evans; Esther L. George; Randal K. Quarles; and Eric S. Rosengren. Implementation Note issued March 20, 2019

Federal Reserve March FOMC Statement Changes via RANsquawk @RANsquawk



Source: Federal Reserve

From the TradersCommunity Research Desk

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