- FED KEEPS TARGET INTEREST RATE STEADY AT 2.25-2.50%; NEARLY HALF OF POLICYMAKERS SEE LOWER RATES AS APPROPRIATE THIS YEAR
- FED SAYS UNCERTAINTIES HAVE INCREASED REGARDING OUTLOOK FOR SUSTAINED ECONOMIC EXPANSION
- FED SAYS WILL ACT AS APPROPRIATE TO SUSTAIN ECONOMIC EXPANSION WITH A STRONG LABOR MARKET AND INFLATION NEAR TARGET
- FED DROPS FROM STATEMENT PREVIOUS LANGUAGE THAT IT WOULD BE 'PATIENT' ON FUTURE POLICY ADJUSTMENTS
- FED VOTE IN FAVOR OF POLICY WAS 9:1, ST. LOUIS FED'S BULLARD DISSENTED BECAUSE HE WANTED A RATE CUT
- FED SAYS ECONOMIC ACTIVITY IS RISING AT A MODERATE RATE
- FED SAYS HOUSEHOLD SPENDING APPEARS TO HAVE PICKED UP BUT BUSINESS FIXED INVESTMENT HAS BEEN SOFT
Economic Projections:
- MEDIAN VIEW OF APPROPRIATE FED FUNDS RATE AT END-2019 2.4% (PREV 2.4%)
- MEDIAN FORECAST OF FED POLICYMAKERS IS FOR NO CHANGE IN RATES IN 2019 BUT NEARLY HALF SEE LOWER RATES
- ONE FED POLICYMAKER SEES ONE RATE CUT IN 2019 AND SEVEN SEE TWO RATE CUTS; EIGHT SEE RATES STEADY AND ONE SEES A RATE HIKE
- FED'S MEDIAN VIEW OF FED FUNDS RATE AT END-2020 2.1% (PREV 2.6%)
- FED SEES ECONOMIC GROWTH SLIGHTLY STRONGER IN 2020, JOBLESS RATE AND INFLATION SEEN SLIGHTLY LOWER, COMPARED TO MARCH PROJECTIONS
- MEDIAN FED LONG-RUN FORECASTS - GDP GROWTH 1.9% (PREV 1.9%); JOBLESS RATE 4.2% (PREV 4.3%); PCE PRICE INDEX 2.0% (PREV 2.0%)
The first (and only, so far) reaction in bonds has been a rally from 2.09 10yr yields down to 2.05% currently. MBS have added an eighth of a point. More to follow...
