Countdown to the Next FOMC Rate Hike

The Federal Reserve's Decision Looms

Key Takeaways from the July 2023 FOMC Meeting

After 11 rate hikes in a relentless battle against soaring inflation, the Federal Open Market Committee (FOMC) is poised to announce its next move. Armed with the CME FedWatch Tool, market watchers are eagerly awaiting the central bank's decision on the Fed Funds target rate.

Inflation Battle Continues

At the July 2023 meeting, the FOMC raised interest rates to 525-550, the highest target level since 2001. While inflation has eased slightly, it remains well above the Fed's target of 2%. The FOMC is widely expected to maintain its current target range between 5.25 and 5.5%, setting the stage for further rate increases in the coming months.

Economic Projections and Cut Expectations

The FOMC's Summary of Economic Projections, released in conjunction with the March 2023 meeting, provides insights into the Fed's outlook for the economy and interest rates. Market participants are closely monitoring the Fed's projections for the Fed Funds Rate Median (FEDTARMD) in 2024 and beyond.

Market Impact

FOMC announcements are eagerly anticipated by investors, businesses, and policymakers alike. The decision on interest rates can have a significant impact on currency markets, stock prices, and overall economic activity. Given the current market anticipation of just one rate cut this year, traders will be closely watching for any changes in the Fed's forward guidance.

Five Key Takeaways from the July Decision

As the FOMC prepares for its next meeting, we highlight five key takeaways from the July 2023 decision and press conference held by Federal Reserve Chair Jerome Powell:

• Aggressive rate hikes will continue
• Inflation remains a primary concern
• Economic growth is slowing
• The Fed anticipates only one rate cut in 2023
• The Fed is committed to bringing inflation back to its target