Fed review: FOMC signals Fed Funds above 5% in 2023

The US Federal Reserve hiked the Fed Funds Rate by 50bp as widely anticipated. The updated 'dots' signal policy rates above 5% in 2023.
EUR/USD recovered near pre-meeting levels despite the hawkish rate projections, as Powell left the door open for less hikes if warranted by data.
Resilient consumption, tight labour markets and still high underlying price pressures support the case for further hikes in Q1. We maintain our forecast of 50bp in February and 25bp in March unchanged.

Danske Research Team Danske Bank A/S

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Danske Research Team

Danske Bank A/S

Research is part of Danske Bank Markets and operate as Danske Bank's research department. The department monitors financial markets and economic trends of relevance to Danske Bank Markets and its clients.

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