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US Federal Reserve Chair Jerome Powell delivered his post-Federal Open Market Committee (FOMC) speech on September 20, 2023.
Interest Rates Remain Unchanged
Powell announced that the FOMC had decided to maintain interest rates at the range of 5.25-5.50 bps. In his opening statements, US Fed Chair Powell acknowledged that the current policy stance is restrictive. Thus, emphasizing the Fed’s commitment to reaching the 2% inflation target. He stated that most policymakers believe another rate hike is likely.
Unanimous Support for Current Policy
Powell noted that the proposal to uphold the existing policy stance received unanimous backing from policymakers. During the September 20, 2023 meeting, the Bitcoin price exhibited minimal change following the FOMC’s decision to maintain the interest rate at 5.25-5.50%.
The Federal Reserve predicts that the median PCE inflation rate will decrease to 3.3% by the close of 2023, with further reductions to 2.5% and 2.2% in 2024 and 2025, respectively.
Interest Rate Hike Speculation for November US Fed Chair
The FOMC acknowledged that inflation persists at elevated levels, while unemployment remains low. The Fed prioritizes achieving the 2% inflation target over time. Currently, the CME FedWatch Tool indicates a 36.3% probability of an interest rate increase to the 5.50-5.75% range in the November FOMC meeting.
Powell expressed optimism about the potential for future interest rate cuts, citing the Fed’s ability to proceed cautiously given the proximity to the inflation target. He stated, “We have the ability to move carefully, meeting by meeting.”
Meanwhile, the S&P 500 Index saw a 0.30% decline in response to the hawkish tone of Powell’s speech, impacting various sectors including the crypto forex broker industry.
Disclaimer: Please note that this article serves solely for informational purposes and should not be construed as financial advice. We strongly advise readers to conduct thorough research and consult with financial professionals before making any investment decisions.
