🧵 Key takeaways from the Fed FOMC statement & Warsh’s press conference
1/ FOMC statement
- Rates: Held at 3.75%–4.00%, in line with market expectations
- Vote: Passed 10–2, with Hammack and Cook favoring a 25-basis-point hike
- Inflation remains elevated; reiterated the goal of returning to 2% “in a timely manner”
- The economy continues to expand at a solid pace, unemployment is stable, and domestic demand remains resilient
2/ Warsh press conference · Rates
- Forward guidance should not be taken at face value unless a crisis occurs
- The effects of the September rate hike were broadly as expected
- Credit conditions have tightened, but have not been formally deemed restrictive
- Monitoring external economic conditions and prepared to act; more information will help inform policy
3/ Warsh press conference · Inflation/economy
- Inflation expectations are moving in the right direction
- Faster economic growth does not necessarily lead to inflation
- The PCE inflation target is clearly 2%; there is no “soft target”
- Q3 GDP is expected to exceed 3%; most officials believe the economy is not overheating
- Productivity is strong, and capital spending has expanded into more sectors
4/ Warsh press conference · Other
- Attending a November 16 hearing on AI’s impact on productivity and employment
- Emphasized the Fed’s independence and said it had not been subject to political interference
- The AI boom is also affected by interest rates
- Investors have become more cautious, with particular attention on the South Korean market
5/ Market reaction
- U.S. Treasury yields fluctuated slightly
- Spot gold moved by about $40
- U.S. stocks edged up and down, while the dollar fell by more than 20 points
- Markets slightly pared rate-hike expectations: 23.4 basis points for December and 46 basis points cumulatively by next March
#美联储 #FOMC #Inflation
1/ FOMC statement
- Rates: Held at 3.75%–4.00%, in line with market expectations
- Vote: Passed 10–2, with Hammack and Cook favoring a 25-basis-point hike
- Inflation remains elevated; reiterated the goal of returning to 2% “in a timely manner”
- The economy continues to expand at a solid pace, unemployment is stable, and domestic demand remains resilient
2/ Warsh press conference · Rates
- Forward guidance should not be taken at face value unless a crisis occurs
- The effects of the September rate hike were broadly as expected
- Credit conditions have tightened, but have not been formally deemed restrictive
- Monitoring external economic conditions and prepared to act; more information will help inform policy
3/ Warsh press conference · Inflation/economy
- Inflation expectations are moving in the right direction
- Faster economic growth does not necessarily lead to inflation
- The PCE inflation target is clearly 2%; there is no “soft target”
- Q3 GDP is expected to exceed 3%; most officials believe the economy is not overheating
- Productivity is strong, and capital spending has expanded into more sectors
4/ Warsh press conference · Other
- Attending a November 16 hearing on AI’s impact on productivity and employment
- Emphasized the Fed’s independence and said it had not been subject to political interference
- The AI boom is also affected by interest rates
- Investors have become more cautious, with particular attention on the South Korean market
5/ Market reaction
- U.S. Treasury yields fluctuated slightly
- Spot gold moved by about $40
- U.S. stocks edged up and down, while the dollar fell by more than 20 points
- Markets slightly pared rate-hike expectations: 23.4 basis points for December and 46 basis points cumulatively by next March
#美联储 #FOMC #Inflation