MNI BRIEF: ISM Expects Sluggish Growth, Sticky Services Prices

MNI BRIEF: German Infl In Line With EA, Growth Lags - GCEE

MNI BRIEF: Focus Support For Cutting-Edge Tech - Ministry

MNI BRIEF: EU Won't Necessarily Follow US on Tariffs-Gentiloni

MNI China Daily Summary: Wednesday, May 15

MNI: PBOC Conducts CNY125 Bln 1Y MLF Weds; Rates Unchanged

MNI: US TSY TICS NET FLOWS IN MAR +$102.1B

EZ/UK T-Bill Calendar: 1/3/6-Month UKTB Auction on Friday

EZ/UK Bond Supply Calendar: Spain, France Auction on Thursday

RPT-MNI: Canada Sticks To Fiscal Anchors, Spends Chunk Of Windfall

MNI BRIEF: Poilievre Calls QE 'Scam' And Would Limit BOC Remit

MNI: Growth Drag From Net Zero Carbon Goal Can Be Offset-OECD

© 1982-2023 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

In Intermeeting Period, FOMC Participants See No Rush To Cut Rates (1/2)

FED
BulletHomepageCreditMarketsFixed Income BulletsForeign Exchange Bullets

In the intermeeting period (March 21 – April 19), several FOMC participants noted that while cutting rates by some magnitude this year was still their baseline, the evident strength in job growth and economic activity meant that there is no rush to initiate rate cuts given higher inflation readings. More details in our full FedSpeak PDF.

  • Chair Powell summed up FOMC sentiment by saying that “the recent data have clearly not given us greater confidence and instead indicate that it’s likely to take longer than expected to achieve that confidence”.
  • A few FOMC participants revealed their March meeting Fed funds rate “dot” submissions for 2024 (which, recall, revealed a median of 75bp of cuts expected for the year), but above-expected employment (Apr 5) and CPI (Apr 10) reports caused most if not all to reconsider their outlook.
  • Goolsbee, Mester and Daly said prior to April's CPI and payrolls releases that 3 cuts were their baseline; all cited the need for a more patient outlook after the data, though without an explicit updated rate forecast.
  • Bostic eyes 1 cut (both prior to and after April's key data), while Kashkari saw 2 rate cuts before the data though noted post-CPI the need to "wait and see and be patient".
  • At least five members entertained the idea of potential rate hikes to varying degrees.
  • NY Fed's Williams noted just before the pre-FOMC blackout period that while it wasn't his "baseline expectation now", the Fed could need to hike if "the data were telling us that". Bowman, Collins, Goolsbee, and Bostic made similar comments in the inter-meeting period.
264 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.

In the intermeeting period (March 21 – April 19), several FOMC participants noted that while cutting rates by some magnitude this year was still their baseline, the evident strength in job growth and economic activity meant that there is no rush to initiate rate cuts given higher inflation readings. More details in our full FedSpeak PDF.

  • Chair Powell summed up FOMC sentiment by saying that “the recent data have clearly not given us greater confidence and instead indicate that it’s likely to take longer than expected to achieve that confidence”.
  • A few FOMC participants revealed their March meeting Fed funds rate “dot” submissions for 2024 (which, recall, revealed a median of 75bp of cuts expected for the year), but above-expected employment (Apr 5) and CPI (Apr 10) reports caused most if not all to reconsider their outlook.
  • Goolsbee, Mester and Daly said prior to April's CPI and payrolls releases that 3 cuts were their baseline; all cited the need for a more patient outlook after the data, though without an explicit updated rate forecast.
  • Bostic eyes 1 cut (both prior to and after April's key data), while Kashkari saw 2 rate cuts before the data though noted post-CPI the need to "wait and see and be patient".
  • At least five members entertained the idea of potential rate hikes to varying degrees.
  • NY Fed's Williams noted just before the pre-FOMC blackout period that while it wasn't his "baseline expectation now", the Fed could need to hike if "the data were telling us that". Bowman, Collins, Goolsbee, and Bostic made similar comments in the inter-meeting period.