The FOMC Press Conference Winds Up!!! What’s the consensus?

The FOMC Press Conference Winds Up!!! What's the consensus?

After 2 days of the meeting, the Federal Reserve has come out with its decisions and they are looking positive for the time being. 

The Federal Reserve announced on Wednesday that it has held its benchmark interest rate steady at the previous rates. This decision has come after grueling 11 rate hikes since March 2022, leaving the borrowing costs at their highest level in 22 years. 

As per the decision, the Federal fund rate would remain in a range of 5.25% to 5.5%, the same level as previously announced at the last FED meeting which took place in July. 

Several analysts have widely expected this decision, predicting that the central bank would keep rates unchanged to avoid triggering a recession. 

Furthermore, Deutsche Bank analysts have also suggested that Fed Chair Jerome Powell would emphasize a data-dependent approach for the future to tighten interest rates. 

However, problems are still looming in the air. Even though the Fed isn’t boosting rats today, borrowing costs remain high, making loans like mortgages and credit card debt more expensive for several Americans. The Central Bank is pushing the margin on efforts to tame inflation in 4 decades by damping the demand for purchases like homes and cars. This unique strategy appears to be showing several signs of progress as the price increases have moderated this year. 

Outlook from Commodity Samachar:

Analysts At Commodity Samachar said ” Due to the decision to leave the rate unchanged, traders will be able to see strong support in Bullion. Things are stable for the time being, but a recovery is to be seen moving forward. 

Ankit Kapoor, Head of Research at Commodity Samachar said ” In the upcoming months leading towards 2024, we may see the rates raised till 6%. However, if the situation reaches there, the economy will get shaken and the FED will be under pressure. But since 2024 is an election year, the economy will be restored to balance and we may see the interest rates coming to 5% by the end of 2024- 2025. “

Final note:

In addition to the Federal Reserve, several central banks across the world are scheduled to decide in the upcoming week. These include banks in Britain, Switzerland, Sweden, Norway, Turkey, Indonesia and South Africa. However, Attention has been drawn to the Bank of England, which has expected to raise its interest rates again. 

Commodity Samachar

Learn and Trade with Ease