In summary, the Fed remains in a “wait-and-see” mode, with its policy stance remaining moderately restrictive. While the Fed is still on hold, it believes that the current stance of monetary policy is flexible enough to be adjusted in response to future deviations from its dual mandate. Notably, the Fed has more room to maneuver….Read more
In summary, Powell emphasized the heightened uncertainty surrounding the future economic impact of the new administration’s policies on trade, immigration, regulation, and fiscal policy. He noted that while sentiment has turned negative, this shift has not yet appeared in hard data. The economy remains on solid footing, supported by low and stable unemployment at 4.1%, real GDP growth of approximately 2%, and headline PCE inflation at 2.5%….Read more
CAPATA Financial’s take on today’s FOMC press conference and announcement: In summary, Powell deemphasized the committee’s recent shift toward focusing policy responses on a potential weakening in the labor market, instead highlighting that unemployment remains low and stable. This shift signals that the committee is currently more concerned about inflation either rising further or failing…Read more
CAPATA Financial’s take on today’s FOMC press conference and announcement: In summary, both the SEP and the press conference were more hawkish than many market participants had anticipated. The committee indicated they are now pricing in two rate cuts for next year…Read more
CAPATA Financials’ take on today’s FOMC press conference and announcement: In summary, Powell highlighted the Fed’s focus on its maximum employment mandate and broader macroeconomic stability over concerns of persistent inflation during the press conference. The key shift occurred when Powell discussed “recalibrating policy,”…Read more
CAPATA Financials’ take on today’s FOMC press conference and announcement: In summary, Powell was much more dovish in his press conference than would be interpreted from the language of the FOMC statement today. He reiterated that the stance of monetary policy was restrictive and that it was well-positioned to react to either side of their dual mandate moving out of balance from their congressionally mandated goals of two percent inflation…Read more
CAPATA Financial’s take on today’s FOMC press conference and announcement: In summary, as the Fed maintains ‘restrictive’ rates for longer, we anticipate continued pressure on interest rate-sensitive sectors of the economy (CRE, housing, credit tightening, etc.), as well as overall growth. The only dovish signal from the Fed today was the announcement to slow QT. Slowing the balance….Read more
CAPATA Financial’s take on today’s FOMC press conference and announcement: In summary, the SEP’s dovish Dot Plot has reinforced market expectations of looser monetary policy going forward. The market’s reaction, evident in rallying long-term yields and equities, reflects this sentiment. Despite the recent CORE CPI reading of 4.0% and fluctuations in oil prices, there’s a … Read more
CAPATA Financial’s take on today’s FOMC press conference and announcement: In summary, we anticipate that if long-term yields, specifically the 10-year note, continue to rise, the committee will maintain the Fed Funds rate at current levels moving forward, and the flattening of the yield curve will increase the probability of a recession. It may seem counterintuitive to hope for an … Read more
