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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.
FED
MNI expects only limited changes in the policy statement vs November’s edition. (Link to November FOMC statement)
- The first paragraph will probably be updated slightly, with the removal of the “third quarter” language, but still recognizing that growth remains “strong” or similar. The labor market language will probably stay unchanged.
- It is coming closer to the time that the Committee will change the “elevated” inflation language to reflect ongoing progress but we think it is perhaps a meeting too early (Tuesday's CPI report probably didn't move the needle in this regard), and almost all FOMC participants in the pre-blackout period characterized inflation as remaining too high despite the soft October data.
- In the second paragraph: “financial” conditions language was added in November to reflect the significant rise in long-end real and nominal yields in October – given the recent rally in Treasuries, that’s looking dated.
- While it was inserted in part to justify another rate hold at the last meeting, the FOMC may be stuck with this language for this month, with more wholesale changes to this paragraph probably due – especially on credit/banking – once the pivot toward rate cuts gets underway in 2024. It's possible - in a lighter edit - "tighter" gets amended to just "tight", given the change in financial conditions since the November meeting.
Source: Nov FOMC Statement - MNI Highlights
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.
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