Fed meeting

2022 - 11 - 2

What to expect from the Federal Reserve meeting (CNN)

There's also a chance it could trigger a recession. While Fed Chair Jerome Powell has stressed that persistent, entrenched inflation would bring greater ...

Sales of [newly constructed homes](https://www.cnn.com/2022/10/26/homes/new-home-sales) dropped 10.9% in September from August and were down 17.6% from a year ago. The much bigger question is around how the Fed signals its future policy path,” wrote Luke Bartholomew, senior economist at abrdn, in a note. They will be closely watching Powell’s post-meeting press conference to see if he lays the groundwork for a step down in the pace of rate hikes. Friday’s upcoming jobs report is expected to show the economy added another 205,000 positions in October, down from last month but still historically high. That’s the highest the fed funds rate has been since January 2008. There’s also a chance it could trigger a recession.

Fed poised to hike rates by 0.75 percentage points for fourth time (The Washington Post)

Recession risks are growing, but the Federal Reserve is sticking with aggressive interest rate increases for now.

Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.), issued a [letter](https://www.warren.senate.gov/imo/media/doc/2022.10.31%20Letter%20to%20Fed%20re%20Monetary%20Policy.pdf) to Powell warning that the Fed against inflicting needless harm. [ramped up their criticism](https://www.washingtonpost.com/business/2022/10/27/fed-democrats-rate-hikes/?itid=lk_inline_manual_25) of the central bank, arguing that such massive rate hikes will inevitably hurt the labor market. [job market](https://www.washingtonpost.com/business/2022/10/07/september-jobs-report-labor-market/?itid=lk_inline_manual_21) remains remarkably resilient and is still churning. The unemployment rate is low at 3.5 percent, and employers are still eager to hire new workers, with the number of [job openings](https://www.washingtonpost.com/business/2022/10/23/federal-reserve-job-vacancies-labor/?itid=lk_inline_manual_21) rising in September to 10.7 million. [said](https://www.federalreserve.gov/mediacenter/files/FOMCpresconf20220921.pdf) when the Fed raised rates in September. Compounding the challenge is that interest rates are blunt and only target demand in the economy. Outside the Fed, inflation has become a major issue for voters and candidates ahead of the midterm elections. Economists and Fed watchers also note that the Fed’s decisions are also amplified as central banks around the world Rate hikes take months to fully sink into the economy, and the growing fear is that the Fed will outrun its ability to gauge whether its policies are working. Core inflation, a measure closely watched by the Fed that strips out more volatile categories such as food and energy, also came in hot. Yet that fight is drawing increasing criticism, from economists and lawmakers, that the Fed is The bank is moving at a level of intensity not seen in decades.

The Fed's Next Rate Hike Is Coming. Why Powell Won't Say the End ... (Barron's)

There are many reasons for the Federal Reserve chairman to maintain a hawkish stance on rate hikes.

The committee’s policy statement is out at 2 p.m. That would mean the sixth rate hike of 2022 and fourth-straight 0.75 percentage-point bump. Markets won’t get their much-anticipated all-clear signal from the Fed.

Here's the key change in the Fed's statement that's moving markets (CNBC)

The Fed introduced a key change to its policy statement on Wednesday, which Wall Street traders are interpreting as a sign that the central bank could soon ...

Text appearing for the first time in the new statement is in red and underlined. Text removed from the November statement is in red with a horizontal line through the middle. Notably, the statement now says that the Fed is considering the "cumulative" impact of its hikes so far.

WATCH LIVE: Federal Reserve Chair Jerome Powell faces ... (PBS NewsHour)

So far this year, the Fed has raised its key rate five times in an aggressive pace that has sent borrowing rates surging across the economy and heightened the ...

That would serve to make borrowing even more expensive and would further heighten the risk of a recession. If Powell does signal Wednesday that the Fed may lift its foot slightly off the economic brakes, it could spark a rally in stock and bond prices. Those higher labor costs are often passed on to customers in the form of higher prices, thereby fueling more inflation. What many Fed-watchers hope is that Chair Jerome Powell will hint at a news conference that the central bank may ease the pace of its hikes, perhaps to a half-point in December and two quarter-point hikes next year. So far this year, the Fed has raised its key rate five times in an aggressive pace that has sent borrowing rates surging across the economy and heightened the risk of a recession. Chronic inflation has also become a central point of attack for Republicans against Democrats in the midterm congressional elections.

Why The Fed's December Meeting May Help Signal Peak Interest ... (Forbes)

As the Fed begins to hint at a pause in interest rates, the December rate decision will provide clues for the timeline.

Equally if the Fed moved rates up just 0.25 percentage points, a pause could be more imminent in 2023. Currently futures market imply a 0.5 percentage-point hike in rates as the most probable scenario and perhaps the start of a progression to a pause in rates. That would imply the Fed could pause hiking rates at its March 2023 meeting. That means the Fed may pause rates before inflation data becomes much more rosy. “The Committee anticipates that ongoing increases in the target range will be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time. That scenario is seen as quite possible, but less likely than a 0.5 percentage point move in December. Now this doesn’t mean that any pause is imminent, given how far ahead the Fed plans, but it is likely looking to tee at least a smaller rate hike if data plays out as anticipated. However, Fed Chair Jerome Powell did indicate at the November press conference that it was “very premature” to be talking about a pause in rising rates. So, yes, the Fed will be watching other economic indicators, too, just as you would expect. However, the Fed is discussing what it would take to ultimately ease off on rate hikes. However, Powell commented that the U.S. With its November statement, the Fed has offered an early signal that we may be getting closer to peak interest rates of around 5%.