FOMC: The road to neutral – Standard Chartered

Sandeep Kanihama FXStreet Contributor

Analysts at Standard Chartered note that the FOMC raised the fed funds target range (FFTR) by another 25bps to 1.75-2.0% on 13 June.

Key Quotes

“It also upgraded the median 2018 FFTR projection to 2.4% (from 2.1%), and more unexpectedly, moved up the 2019 median to 3.1% (from 2.9%), raising the expected path of policy and leading to a notable flattening in money-market curves around the 2019 point.”

“The interest rate on excess reserves (IOER) was raised by 20bps, as telegraphed in the May meeting minutes, for technical reasons.”

“Long-run projections were unchanged, indicating that the FOMC continues to see recent and near-term projected economic strength as cyclical, for now. These decisions are largely in line with our expectations.”

“There were hawkish changes to the statement.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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