FOMC Policy Announcement and SEP – Rate Cuts Coming, But Maybe Not Soon
The Fed kept policy rates unchanged for the fifth consecutive meeting, as completely expected, with the target range for the fed funds rate at 5.25%-to-5.50%. Overall, the policy statement was identical to the previous one except the mention of job growth as having “moderated” was removed; it’s now just “strong”. Importantly (and as anticipated), the forward guidance (changed at the last meeting) was repeated. Recall: “The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent.” In the presser Chair Powell said the inflation data for January and, so far, for February, didn't “boost” confidence.