Traders anticipating a hawkish FED decision

[chuck_curtis]

But it ain't over until Powell sings...
...
Traders widely anticipate that Federal Reserve Chairman Jerome Powell will deliver a much more hawkish press conference, potentially signaling a slower pace of rate cuts or even a pause in the central bank's easing cycle. This sentiment gained traction after Powell recently acknowledged that current levels of inflation would require more time to achieve the 2% target, stating, "Inflation has eased over the past year but remains elevated."

Market observers expect Powell to highlight the recent strong economic indicators, including the core Personal Consumption Expenditures (PCE) index for March and the robust Gross Domestic Product (GDP) numbers. These data points could prompt the Federal Reserve to adopt a more cautious approach toward upcoming rate cuts, diverging from earlier expectations of more aggressive easing.

The latest inflation data revealed that the headline Consumer Price Index (CPI) rose 3.5% year-over-year in March, while the core rate of inflation, excluding energy and food costs, advanced to 3.8% annually. This development could significantly alter the Federal Reserve's stance on the number and timing of rate cuts this year. Initially, the Fed had projected three quarter-point rate cuts through a series of moves, but market participants now anticipate only one or two smaller cuts, potentially occurring later in the year.

According to financial experts, the FOMC's potential shift in language regarding inflation and monetary easing bears significant implications for the markets. An acknowledgment of sustained high inflation rates could dampen hopes for imminent rate cuts, altering investment landscapes and risk assessments. If the FOMC opts to reduce the cap on Treasury balance sheet run-off, this could be interpreted as a cautious step towards tightening, albeit less aggressively than an outright rate hike.

The prospect of a more hawkish Federal Reserve, combined with the prevailing dollar strength, has exerted downward pressure on gold prices, driving futures below the critical $2,300 per ounce level. As traders await the FOMC's decision, the precious metal's trajectory will likely hinge on the central bank's assessment of inflation risks and its subsequent policy adjustments.
...
https://thegoldforecast.com/gold/2024/gold-futures-tumble-below-2300-traders-brace-feds-hawkish-pivot?mc_cid=325ad5c5c9&mc_eid=05da440039

[wvit1001]

Powell's doing a good job.   Inflation in the US is much less than the inflation rates other countries are experiencing.

[D2D]

https://www.foxbusiness.com/economy/small-business-owners-reveal-out-world-impact-bottom-lines

Sure he is!

Be a good boy and have a cookie!

[wvit1001]

yes the cost of goods is rising all around the world right now. 

[chuck_curtis]

He's doing all he can do, but he can't do a thing about democrat's inflationary borrowing and spending.  He has a mandate he is powerless to achieve.

[D2D]

Only where leftists rule!

[chuck_curtis]

Traders got it right this time.

The Federal Reserve left interest rates unchanged at their highest levels in 23 years as monetary policymakers have observed “a lack of further progress” toward the central bank’s 2 percent inflation target.

Fed officials noted that the risks to accomplishing its dual mandate of maximum employment and price stability have shifted to a better balance over the past year. Still, the “economic outlook is uncertain,” and the policymaking Federal Open Market Committee is “highly attentive to inflation risks.”

For now, rate-setting Committee members do not believe “it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward” 2 percent.
...
The Fed also announced that it would start slowing the pace of reducing its securities holdings by decreasing the monthly reduction cap on Treasurys from $60 billion to $25 billion. As for agency debt and agency mortgage-backed securities, the central bank will keep the tapering at $35 billion per month.

It will start in June.
...
https://www.theepochtimes.com/business/federal-reserve-leaves-interest-rates-unchanged-as-inflation-risks-persist-5640875?utm_source=ref_share&utm_campaign=copy

[Dan]

Inflation in the US is much less than the inflation rates other countries are experiencing.

False.

[Truman62]

Denial Yeti at work, please stand by for MORE denial!

[chuck_curtis]

I don't live in any other country.  Thank God!  America is far and away the greatest, and it could be much greater.

[Truman62]

Fed holds interest rates as is, and the Markets go WILD!

[D2D]

The quickest way to kill inflation is to produce more oil and refine more gasoline!

Both of which Democrats oppose!