IGI Logo

Below the Views on US Fed Reserve by Manish Chowdhury, Head of Research, StoxBox

We expect the Federal Reserve to keep its key interest rate unchanged at 5.25% to 5.5% at the end of the two-day policy meeting on Wednesday, with any change in monetary policy outcome still being driven by incoming economic data. Markets would closely watch for any signs on the timing of an interest rate cut going ahead. With the inflation trajectory still not striking chord with the Fed officials and labour market not showing signs of sustained weakness, we believe that the tone of the Fed Chairman is unlikely to change in this FOMC meeting. Our sense is that the CPI reading for May which would prelude the Fed outcome on Wednesday would set the tone if the chatter surrounding a rate cut in September is off the table or not. We would closely watch the FOMC’s Summary of Economic Projections for gaining more insights into the Fed’s patient view of holding rates higher for longer.
 

Above views are of the author and not of the website kindly read disclaimer