🚨 TODAY'S FOMC COULD BE ONE OF THE MOST IMPORTANT MEETINGS OF Q4.
And the reason is simple: INFLATION.
Since the last FOMC meeting, inflation has remained stubbornly elevated. September CPI came in at 3.7% year over year, while producer prices also surprised to the upside.
The Fed's 2% inflation target is still a long way off.
Yet, the market is largely expecting the Fed to hold rates steady today.
That puts Kevin Warsh in a difficult position.
The Fed has already shown its commitment to bringing inflation down. But now the market wants to know:
How far is Warsh willing to go to bring inflation under control?
Here's how I see the possible scenarios:
🔴 If Warsh signals more rate hikes:
Markets could face another wave of selling as traders reassess the outlook for borrowing costs, liquidity, and economic growth.
🟠 If Warsh sounds less committed to further tightening:
Bond yields could rise if investors believe the Fed is falling behind the inflation curve. That could put additional pressure on risk assets.
⚠️ If Warsh avoids giving clear guidance:
Uncertainty could remain elevated. Markets may struggle to find direction, especially if investors were hoping for a clearer path on future rates.
The real issue isn't just today's rate decision.
It's what the Fed says about the next move.
A pause doesn't necessarily mean the inflation fight is over. And a hawkish message doesn't guarantee an immediate sell-off.
But with inflation still above target, the market may be underestimating how difficult the Fed's next decision could become.
Today, listen closely to the message—not just the headline.
Because the rate decision may already be priced in.
The surprise could come from what Warsh says next.
$BTC
And the reason is simple: INFLATION.
Since the last FOMC meeting, inflation has remained stubbornly elevated. September CPI came in at 3.7% year over year, while producer prices also surprised to the upside.
The Fed's 2% inflation target is still a long way off.
Yet, the market is largely expecting the Fed to hold rates steady today.
That puts Kevin Warsh in a difficult position.
The Fed has already shown its commitment to bringing inflation down. But now the market wants to know:
How far is Warsh willing to go to bring inflation under control?
Here's how I see the possible scenarios:
🔴 If Warsh signals more rate hikes:
Markets could face another wave of selling as traders reassess the outlook for borrowing costs, liquidity, and economic growth.
🟠 If Warsh sounds less committed to further tightening:
Bond yields could rise if investors believe the Fed is falling behind the inflation curve. That could put additional pressure on risk assets.
⚠️ If Warsh avoids giving clear guidance:
Uncertainty could remain elevated. Markets may struggle to find direction, especially if investors were hoping for a clearer path on future rates.
The real issue isn't just today's rate decision.
It's what the Fed says about the next move.
A pause doesn't necessarily mean the inflation fight is over. And a hawkish message doesn't guarantee an immediate sell-off.
But with inflation still above target, the market may be underestimating how difficult the Fed's next decision could become.
Today, listen closely to the message—not just the headline.
Because the rate decision may already be priced in.
The surprise could come from what Warsh says next.
$BTC
