Fed officials are meeting today and while experts largely expect the Federal Reserve to hold short-term interest rates steady, it’s not clear how strongly it will signal its intentions for a possible rate hike at the December meeting . Here are four things to watch for following Wednesday's meeting, the Wall Street Journal reports:
1. Signals for December?
After today’s meeting the only guidance we’ll have for future movement will be the official policy statement, so it’s unlikely the Fed will make its intentions for December clear this month. Several Fed officials are opposed to sending any signals in advance at all.
2. How does it view economic health?
In September the Fed said the labor market strengthened, and data since continues to support that trend. At the same time the economy grew at a 2.9% yearly rate in Q3, up from 1.4% in Q2.
3. How risky is its outlook?
Last year the Fed said risks were “nearly balanced” prior to raising rates—if it reuses that language it could be a sign a rate hike is coming in December.
4. Who wants a hike and who doesn’t?
While Cleveland Fed President Loretta Mester, Kansas City Fed President Esther George and Boston Fed President Eric Rosengren all voted to increase rates in September, don’t expect them to vote that way Wednesday. Rosengren has already said he’s happy waiting until December and doesn’t want to add turbulence right before the US presidential election. [WSJ]
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