Thursday, November 3, 2016

The Fed's Pronouncements

The Federal Reserve's statement released yesterday was less straightforward in calling for a December rate hike than expected, but that rate hike looks to be still very much on the table. The Fed warned that “the case for tightening continued to strengthen.”

The Fed also released its economic assessment, which was a mixed bag:
  • Consumer spending, which is finally perking up after a disappointing summer, was downgraded from “growing strongly” to “rising moderately.”
  • The Fed says “market-based measures of inflation expectations have moved up” but “survey-based measures of longer-run expectations are little changed."
  • Job gains continue to characterized as “solid,” despite a recent slowdown. The October jobs report will be out on Friday.

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