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September 18, 2019

In the seven weeks since the Federal Open Market Committee authorized the first federal funds target decline since December 2008, the 10-year treasury yield had dropped 27 basis points on balance, but there has been scant net change in EUR/USD, dollar/yen, U.S. share prices or the price of oil. The rate reduction on July 31 […] More

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July 31, 2019

In the six weeks since the last scheduled FOMC meeting, the dollar has edged up 0.2% against the yen and 0.8% versus the euro. It’s been a period in which Fed officials have prepared markets rhetorically to expect an interest rate cut today, so it’s somewhat surprising that the 10-year Treasury yield is now only […] More

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June 19, 2019

After meeting last time seven weeks ago, the Federal Open Market Committee upgraded its assessment of economic growth, called the U.S. labor market strong, maintained the federal funds target range at 2.25-2.50%, and also kept the buzzword “patient” in describing its predisposition toward future adjustments of the policy stance. In rhetoric from Chairman Powell and […] More

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May 1, 2019

At the previous review of U.S. monetary policy on March 20, members of the Federal Open Market Committee modified their forward guidance on interest rates, eliminating each of the likely two hikes in 2019 that had been signaled at the final 2018 FOMC meeting in December. m date to be mentioned at this time. A […] More

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March 20, 2019

Over the seven weeks since the last FOMC meeting, the dollar and price of oil have strengthened. Share prices recovered additionally, but the 10-year Treasury yield has fallen back 13 basis points. Forward guidance in the January 30th statement was less hawkish, deleting the previous assertion that further gradual increases in the target interest rate […] More

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January 30, 2019

The first rule of Federal Reserve chairmen when wearing their communicator-in-chief hat is to do no harm.¬†Chairman Powell failed that test at December’s press conference by placing a very positive spin on U.S. economic trends and appearing not to back away from a baseline expectation that the a couple more interest rate hikes in 2019 […] More

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December 19, 2018

It’s been a very eventful period in the market during the 6-week FOMC cycle since the early November policy meeting, but notably the dollar only slipped 0.25% against the euro on balance. Outside of this oasis of stability, however, the ten-year Treasury yield is now 42 basis points lower than then, and the Dow Jones […] More

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November 8, 2018

FOMC policy has become an epitome of predictability in rate-rising cycles. For decades, the Fed didn’t even announce policy changes, and it could take some time to discern that one had occurred by watching open market operations and determining behavior that couldn’t be explained by seasonal and other special factors. Policymakers have come to believe […] More

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September 26, 2018

Markets have already priced in the Fed’s eighth¬†increase of the federal funds target to a range of 2.0-2.25%. The increment of each hike has been 25 basis points, so today’s likely move will complete two full percentage points of tightening and be probably enough to warrant deletion in today’s FOMC statement of a characterization of […] More

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August 1, 2018

The federal funds target in the current campaign of rate normalization has undergone seven 25-basis point increases, their dates being December 2015, December 2016, March, June and December of 2017, March 2018 and, most recently, on June 13th at its previous meeting. Today’s announcement at 14:00 EDT will not be accompanied by new forecasts nor […] More

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