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The fed fund rate was raised by +75 bps (+0.75%) to 1.50-1.75% range & more 50-75 bps increases are coming; the QT is continuing as previously announced. The interest paid on reserves held at the Fed are now 1.65%; the discount/primary rate is 1.75%. The labor market remains strong & inflation data have surprised to the upside. Fed's goals are positive real rates & taming consumer demand because many other factors are out of Fed's control (global commodity prices, Russia-Ukraine war, Covid-19 issues in China). Headline inflation is what the public & the Congress care about, but the core inflation is more meaningful for the Fed to adjust monetary policy. Changing inflation-expectations via forward guidance is working as intended but the Fed is not locked into its previous guidance (so, it isn't bothered by "misses") & looks at the incoming data (current retail sales & housing data, UM Sentiment, etc) & some of it came during the blackout week this time. https://ybbpersonalfinance.proboards.com/thread/158/fomc-statements-6-7-weeks?page=1&scrollTo=665
I agree 1% would be a bazooka-level move that would've sent a decisive message. Meaning, I wonder if they can comfortably go 2 months w/o making an incremental increase between meetings....
There may be a concern of aggressive rate hike only hasten a recession. Seeing layoff now in some mortgage industry. When this spreads to the broader workforce in the future, that can spell problem.
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https://ybbpersonalfinance.proboards.com/thread/158/fomc-statements-6-7-weeks?page=1&scrollTo=665