FOMC Interest rate decision (Fed) | News & Analysis
US Treasury’s Bessent: Fed shouldn’t delay rate cuts
US Treasury Secretary Scott Bessent said on a CNBC interview on Thursday that the Federal Reserve (Fed) should continue to cut rates.
Fed's Miran: Fed should cut more than 100 basis points this year
Federal Reserve (Fed) Governor Stephen Miran told Fox Business on Tuesday that he expects data to support more rate cuts and further argued that the Fed should cut more than 100 basis points this year.
Fed's Barkin: Upcoming rate decisions will need to be finely tuned
Richmond Federal Reserve Bank President Thomas Barkin said on Tuesday that upcoming rate decisions will need to be "finely tuned" given risks to both unemployment and inflation goals, per Reuters.
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USD/JPY climbs above 159.00 amid Japan's fiscal, political concerns
The USD/JPY pair jumps to near 159.15, the highest since July 2024, during the early Asian session on Wednesday. The Japanese Yen weakens against the US Dollar amid concerns about looser fiscal and monetary policy in Japan. Traders will keep an eye on the US Retail Sales and Producer Price Index reports, which will be published later on Wednesday.
More pressure on the Federal Reserve emerges
News broke on Sunday night that the Federal Reserve received grand jury subpoenas from the Department of Justice on Friday, escalating the Trump administration's pressure on the nation's central bank.
Gold rises above $4,600 on US rate cut expectations, Fed uncertainty
Gold price rises to around $4,600 during the early Asian session on Wednesday. The precious metal gains momentum as traders firm up bets on US interest rate cuts after the release of inflation data. Traders will take more cues from the US Retail Sales and Producer Price Index data later in the day.
Ethereum Price Forecast: Buying momentum returns amid steady network growth
Ethereum (ETH) has been seeing mild renewed buying activity since the beginning of the week. After recording steady inflows throughout last week, ETH Exchange Netflow has flipped to over 100K ETH in outflows this week.
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What's important about the Federal Reserve’s monetary policy meeting?
With a pre-set regularity, a nation's central bank holds a monetary policy meeting where board members take different measures, the most relevant one setting the range of the federal funds rate, which greatly influences the interest rate charge on loans and advances to commercial banks.
In the US, the Federal Open Market Committee (FOMC) of the Federal Reserve (Fed) meets at intervals of five to eight weeks to announce their latest decisions. An interest-rate hike increases borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors. A rate cut, on the other hand, tends to weaken the USD.
If rates remain unchanged, the attention, main news and analysis turn to the tone of the monetary policy statement and the press conference from the Fed’s Chair. Markets analyze whether the tone is hawkish or dovish over future developments of inflation.
What is the Fed?
The Federal Reserve (Fed) is the central bank of the United States (US) and it has two main targets: to maintain the unemployment rate at its lowest possible levels and to keep inflation around 2%. The Federal Reserve System's structure is composed of the presidentially appointed Board of Governors and the partially appointed Federal Open Market Committee (FOMC). The FOMC organizes eight scheduled meetings in a year to review economic and financial conditions. It also determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth. The FOMC Minutes, which are released by the Board of Governors of the Federal Reserve weeks after the latest meeting, are a guide to the future US interest-rate policy.
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How to trade the event?
- Do not rely on the Fed to determine the direction of the dollar in the coming months.
- The dollar tends to follow its predominant trend when the Fed starts to hike rates.
- There is no direct link between the Fed hiking rates and the usd falling. When a weak usd has coincided with a Fed hiking cycle, it has been falling for some time.
- Due to this, we may see a muted reaction to a potential Fed rate hike.
WHO IS FOMC'S CHAIRMAN?
Jerome Powell
Jerome Powell took office as chairman of the Board of Governors of the Federal Reserve System in February 2018, for a four-year term ending in February 2022. His term as a member of the Board of Governors will expire January 31, 2028. Born in Washington D.C., he received a bachelor’s degree in politics from Princeton University in 1975 and earned a law degree from Georgetown University in 1979. Powell served as an assistant secretary and as undersecretary of the Treasury under President George H.W. Bush. He also worked as a lawyer and investment banker in New York City. From 1997 through 2005, Powell was a partner at The Carlyle Group.
Jerome Powell Fed's Profile and Wikipedia
The World Interest Rates Table
The World Interest Rates Table reflects the current interest rates of the main countries around the world, set by their respective Central Banks. Rates typically reflect the health of individual economies, as in a perfect scenario, Central Banks tend to rise rates when the economy is growing and therefore instigate inflation.