January 2024 FOMC Preview
January 31, 2024
The Fed policy announcement and subsequent press conference are scheduled for 14:00 EST and 14:30 EST. Macro-economic forecasts have not been updated for this meeting, and policy settings are expected to be left unchanged. So the focus will be on the statement’s first paragraph that defines U.S. growth and price trends and on what Chairman Powell says afterward pertaining to the possible timing of an initial rate cut and pace of reductions likely to be made. The last set of updated projections released in December implied a total 75 basis points of reduction during 2024, but many analysts think the true figure will be higher. Opinions are split on whether officials skip mix in rate pauses or, once easing has begun, do a cut each time but never by more than 75 basis points.
The statement from mid-December talks of slower U.S. economic growth after the rapid third quarter pace and strong but moderating job gains. Inflation was still considered elevated, but officials conceded the trend had been downward for the past year. At 3.3% at an annualized rate, fourth quarter GDP growth again exceeded expectations. In December employment jumped by 216k last month, and job openings exceeded the prior month by over 100k. On the other hand, 8 of the 12 Federal Reserve districts reported little or no growth in the latest Beige Book, plus the Minneapolis District experienced a modest contraction in activity. Price data also have mixed, with core service sector prices remaining sticky and oil prices roughly 10% higher now than then. But the overall core PCE deflator was at the 2.0% Fed objective in both quarters of the second half of 2023 when expressed at a 3-month annualized rate.
Over the seven weeks since the December meeting, financial market conditions have eased in some respects. Share prices have rallied, and long-term interest rates are a tad lower now. However, the dollar has appreciated against the yen.
| EUR/$ | $/JPY | 10Y, % | DJIA | Oil, $ | |
| 06/30/04 | 1.2173 | 109.44 | 4.63 | 10396 | 37.95 |
| 06/30/05 | 1.2090 | 110.89 | 3.96 | 10370 | 57.00 |
| 06/29/06 | 1.2527 | 116.07 | 5.20 | 11077 | 73.41 |
| 06/28/07 | 1.3452 | 123.17 | 5.10 | 13456 | 69.82 |
| 08/07/07 | 1.3749 | 118.55 | 4.73 | 13510 | 72.27 |
| 09/18/07 | 1.3888 | 115.75 | 4.51 | 13475 | 81.42 |
| 10/31/07 | 1.4458 | 115.28 | 4.42 | 13873 | 93.59 |
| 12/11/07 | 1.4682 | 111.49 | 4.11 | 13645 | 89.78 |
| 01/30/08 | 1.4792 | 107.31 | 3.70 | 12454 | 91.70 |
| 03/18/08 | 1.5786 | 98.73 | 3.41 | 12257 | 107.53 |
| 04/30/08 | 1.5562 | 104.58 | 3.83 | 12953 | 111.54 |
| 06/25/08 | 1.5568 | 108.37 | 4.18 | 11837 | 133.62 |
| 08/05/08 | 1.5445 | 108.42 | 3.97 | 11484 | 119.82 |
| 09/16/08 | 1.4144 | 105.16 | 3.36 | 10936 | 91.18 |
| 10/08/08 | 1.3625 | 99.87 | 3.50 | 9447 | 87.02 |
| 10/29/08 | 1.2933 | 97.15 | 3.81 | 9145 | 67.38 |
| 12/16/08 | 1.3790 | 90.14 | 2.52 | 8687 | 44.14 |
| 01/28/09 | 1.3253 | 90.01 | 2.61 | 8356 | 42.92 |
| 03/18/09 | 1.3115 | 98.13 | 2.94 | 7340 | 47.73 |
| 04/29/09 | 1.3331 | 97.06 | 3.02 | 8194 | 51.05 |
| 06/24/09 | 1.3984 | 95.43 | 3.59 | 8373 | 68.76 |
| 08/12/09 | 1.4221 | 96.17 | 3.71 | 9366 | 70.64 |
| 09/23/09 | 1.4779 | 91.50 | 3.50 | 9859 | 69.13 |
| 11/04/09 | 1.4884 | 90.75 | 3.51 | 9896 | 80.66 |
| 12/16/09 | 1.4542 | 89.78 | 3.56 | 10478 | 73.14 |
| 01/27/10 | 1.4045 | 89.49 | 3.61 | 10148 | 73.31 |
| 03/16/10 | 1.3756 | 90.64 | 3.67 | 10645 | 81.45 |
| 04/28/10 | 1.3157 | 94.10 | 3.75 | 11043 | 82.57 |
| 06/23/10 | 1.2284 | 90.12 | 3.13 | 10307 | 76.50 |
| 08/10/10 | 1.3107 | 85.85 | 2.81 | 10605 | 79.94 |
| 09/21/10 | 1.3132 | 85.21 | 2.66 | 10747 | 73.05 |
| 11/03/10 | 1.4059 | 81.35 | 2.53 | 11174 | 84.59 |
| 12/14/10 | 1.3423 | 83.37 | 3.38 | 11497 | 88.47 |
| 01/26/11 | 1.3658 | 82.55 | 3.41 | 12001 | 87.36 |
| 03/15/11 | 1.3969 | 81.04 | 3.29 | 11815 | 98.09 |
| 04/27/11 | 1.4665 | 82.63 | 3.36 | 12612 | 112.48 |
| 06/22/11 | 1.4392 | 80.12 | 2.97 | 12175 | 94.87 |
| 08/09/11 | 1.4234 | 77.09 | 2.36 | 10993 | 81.76 |
| 09/21/11 | 1.3778 | 76.34 | 1.93 | 11377 | 86.74 |
| 11/02/11 | 1.3724 | 78.11 | 2.03 | 11805 | 92.77 |
| 12/13/11 | 1.3067 | 77.92 | 1.98 | 12130 | 100.20 |
| 01/25/12 | 1.3027 | 77.96 | 1.97 | 12670 | 98.85 |
| 03/13/12 | 1.3096 | 82.76 | 2.08 | 13044 | 106.34 |
| 04/25/12 | 1.3226 | 81.37 | 1.97 | 13096 | 104.13 |
| 06/20/12 | 1.2693 | 79.28 | 1.66 | 12837 | 83.63 |
| 08/01/12 | 1.2300 | 78.10 | 1.49 | 13028 | 88.98 |
| 09/13/12 | 1.2895 | 77.43 | 1.72 | 13342 | 97.60 |
| 10/24/12 | 1.2948 | 79.75 | 1.77 | 13115 | 85.72 |
| 12/12/12 | 1.3082 | 83.24 | 1.70 | 13325 | 87.13 |
| 01/30/13 | 1.3584 | 91.16 | 2.02 | 13949 | 97.63 |
| 03/20/13 | 1.2948 | 95.65 | 1.94 | 14497 | 92.82 |
| 05/01/13 | 1.3195 | 97.48 | 1.62 | 14740 | 90.47 |
| 06/19/13 | 1.3364 | 95.76 | 2.23 | 15304 | 98.38 |
| 07/31/13 | 1.3301 | 97.92 | 2.67 | 15565 | 105.63 |
| 09/18/13 | 1.3363 | 98.28 | 2.76 | 15606 | 107.01 |
| 10/30/13 | 1.3764 | 98.18 | 2.48 | 15660 | 97.42 |
| 12/18/13 | 1.3696 | 103.81 | 2.89 | 16198 | 98.06 |
| 01/29/14 | 1.3651 | 102.13 | 2.73 | 15719 | 97.23 |
| 03/19/14 | 1.3918 | 101.75 | 2.71 | 16335 | 99.96 |
| 04/30/14 | 1.3868 | 102.11 | 2.66 | 16553 | 99.52 |
| 06/18/14 | 1.3584 | 101.93 | 2.61 | 16892 | 106.12 |
| 07/30/14 | 1.3372 | 102.84 | 2.51 | 16878 | 101.45 |
| 08/17/14 | 1.2961 | 107.60 | 2.57 | 17151 | 94.05 |
| 10/29/14 | 1.2677 | 108.40 | 2.33 | 16956 | 82.51 |
| 12/17/14 | 1.2409 | 117.58 | 2.11 | 17201 | 57.85 |
| 01/28/15 | 1.1337 | 117.77 | 1.78 | 17457 | 44.75 |
| 03/18/15 | 1.0637 | 120.98 | 2.05 | 17733 | 42.49 |
| 04/29/15 | 1.1164 | 118.67 | 2.05 | 18039 | 59.16 |
| 06/17/15 | 1.1255 | 124.22 | 2.39 | 17862 | 59.12 |
| 07/29/15 | 1.1073 | 123.61 | 2.29 | 17720 | 49.17 |
| 09/17/15
10/28/15 |
1.1334
1.1081 |
120.86
120.50 |
2.26
2.07 |
16778
17687 |
47.01
45.83 |
| 12/16/15
01/27/16 03/16/16 04/27/16 06/14/16 07/27/16 09/21/16 11/02/16 12/14/16 02/01/17 03/15/17 05/03/17 06/14/17 07/25/17 09/20/17 11/01/17 12/13/17 01/31/18 03/21/18 05/02/18 06/13/18 08/01/18 09/26/18 11/08/18 12/19/18 01/30/19 03/20/19 05/01/19 06/19/19 07/31/19 09/18/19 10/30/19 12/11/19 01/29/20 03/03/20 03/15/20 03/23/20 04/29/20 06/10/20 07/29/20 09/16/20 11/05/20 12/16/20 01/27/21 03/17/21 04/28/21 06/16/21 07/28/21 09/22/21 11/03/21 12/15/21 01/26/22 03/16/22 05/04/22 06/15/22 07/27/22 09/21/22 11/02/22 12/14/22 02/01/23 03/22/23 05/03/23 06/14/23 07/26/23 09/20/23 11/01/23 12/13/23 01/31/24 |
1.0956
1.0874 1.1089 1.1339 1.1205 1.0998 1.1160 1.1099 1.0641 1.0741 1.0638 1.0910 1.1149 1.1735 1.2010 1.1631 1.1815 1.2424 1.2271 1.1963 1.1788 1.1668 1.1765 1.1400 1.1420 1.1415 1.1355 1.1244 1.1217 1.1132 1.1066 1.1117 1.1112 1.1002 1.1179 1.1087 1.0697 1.0859 1.1367 1.1787 1.1824 1.1814 1.2174 1.2115 1.1908 1.2071 1.2126 1.1812 1.1722 1.1581 1.1255 1.1287 1.0983 1.0536 1.0438 1.0129 0.9884 0.9884 1.o686 1.0988 1.0792 1.1047 1.0860 1.1065 1.0672 1.0563 1.0875 1.0848 |
121.72
118.48 113.70 111.37 106.15 105.65 100.84 103.33 115.37 113.52 114.48 112.47 111.55 111.17 111.34 113.91 112.58 109.31 106.27 109.91 110.38 111.69 112.94 113.88 112.26 109.55 111.42 111.17 108.36 108.59 108.16 108.89 108.62 109.14 107.21 108.33 111.26 106.73 107.24 104.84 105.00 103.68 103.65 104.07 109.27 108.80 109.97 110.09 109.23 114.01 113.98 114.36 118.62 130.10 133.82 137.31 144.08 146.93 134.86 128.93 132.57 135.22 139.38 140.82 148.06 150.87 142.93 146.29 |
2.29
2.02 1.99 1.89 1.62 1.53 1.70 1.78 2.45 2.49 2.57 2.30 2.13 2.29 2.24 2.35 2.34 2.73 2.89 2.97 2.96 2.99 3.08 3.23 2.81 2.72 2.57 2.48 2.08 2.02 1.75 1.80 1.80 1.61 1.01 1.01 0.81 0.61 0.77 0.59 0.67 0.77 0.91 1.01 1.66 1.62 1.49 1.25 1.31 1.56 1.45 1.78 2.19 2.98 3.34 2.77 3.56 4.03 3.51 3.41 3.54 3.37 3.79 3.89 4.35 4.79 4.02 3.96 |
17583
16002 17217 18013 17675 18461 18151 17989 19915 19890 20885 20920 21375 21711 22376 23405 24585 26259 24839 24095 25309 25310 26543 26195 23881 24841 25727 26624 26452 27210 27048 27067 27877 28833 25917 23185 18592 24667 27169 26467 28196 28418 30,125 30,554 32,868 33,908 34,251 34,938 34,279 35,894 35,493 34,594 33,726 33,242 30,806 31,846 30,850 32,524 34,175 34,093 32,466 33,689 34,108 35,418 34,553 33,226 37,090 38,486 |
35.95
30.85 37.79 44.89 48.29 41.91 43.44 45.18 51.83 53.33 48.43 47.96 44.71 48.75 50.55 54.24 56.60 64.41 65.00 67.57 66.77 67.62 71.68 60.93 47.80 54.51 59.48 63.38 53.65 58.48 58.16 54.60 58.68 53.52 47.18 31.73 23.36 15.30 39.05 41.22 40.00 38.84 47.77 52.81 64.30 63.70 72.32 74.25 71.94 81.14 70.39 87.40 95.70 107.71 116.24 97.36 83.70 88.57 77.56 76.80 70.32 68.70 69.38 78.93 90.28 82.86 69.77 76.44 |
Copyright 2024, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: FOMC preview
ShareThis
