Rates remain unchanged and only two voting members wanted a hike, instead of three in September. Eric Rosengren changed his mind and this does not rock markets. The Fed changed the wording from “strengthened” to “continued to strengthen” regarding raising rates, which is the smallest possible change. Going gradual is the name of the game.
The USD remains unchanged, generally weaker, on election worries, however, the moves are minimal.
More:
- Nov FOMC: We Still Hold The Non-Consensual View Of No Fed Hikes This Year – Danske
- FOMC slightly hawkish – Two opinions
Here’s a passage regarding rates, from the official statement:
The Committee judges that the case for an increase in the federal funds rate has continued to strengthen but decided, for the time being, to wait for some further evidence of continued progress toward its objectives.
The Federal Reserve was expected to leave the interest rate unchanged in its November decision. This is a less important meeting, as it does not consist of a press conference nor new forecasts. And even more importantly, Yellen and her colleagues announce their decision 6 days before the US presidential elections and would rather wait for the outcome.
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November Fed Decision Background
The bigger question is December. Back in September, they hinted about a potential rate increase, at the one year anniversary of the first hike in a decade. A thicker hint albeit not a full commitment was projected. Three voting members dissented: Rosengren, Mester, and George. A repeat of their dissent was on the cards.
Data since the last meeting has not changed the picture: employment grows at the same pace, inflation is similar and growth has picked up in Q3, but that was expected.