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FOMC Update:
• As expected, the Fed has kept the rates unchanged at 5-5.25%. A 90bps fall in headline inflation possibly comforted Fed to keep policy rates unchanged. However, sticky core inflation at 5.3% might prompt Fed to keep the option to hike open at the moment.
• The surprising factor was the dot plot signaling 2 more rate hikes in 2023.
• On rate cuts, Powell mentioned that rate action is unlikely until inflation declines. As already factored in the pricing, US and Domestic yield remained range bound.

Impact:
• We expect a long pause in 2023 in US and domestic front as well.
• Domestic market yields to remain range bound based on Supply, El-Nino, and Headline inflation concerns in July to September quarter. However, in the medium term, rates are expected to head lower and hence makes an good opportunity for investors to invest in fixed income products.

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