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MNI Fed Preview - June 2023: How To Communicate A Hawkish Hold

MNI Fed Preview - June 2023: How To Communicate A Hawkish Hold

MNI Fed Preview - June 2023: How To Communicate A Hawkish Hold


  • The FOMC’s tightening cycle is likely to “skip” June’s meeting, with the Committee holding rates at 5.00-5.25% while signalling that it currently expects to hike at the following meeting in July.
  • While data and events since early May have on balance probably justified another 25bp hike, some data have left room for doubt, and the FOMC has set a fairly high bar to further tightening.
  • In an effort to maintain a hiking bias, the Statement’s forward rate guidance is likely to remain unchanged, with the updated economic projections showing that an additional rate hike is expected by year-end.
  • The main reason to galvanize communications around a bias of future hikes is not just to placate the hawks, but to ensure that expectations of a cut don't rise with any hint that the FOMC is implying the next move will be down.

Note to readers: MNI’s separate preview of sell-side analyst summaries to follow on Monday June 12



Source: MNI Expectations For June 2023 FOMC Dot Plot Projections

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