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In a surprising move, the Federal Reserve is hinting at multiple rate cuts in 2024, sparking questions about the stability of the financial system. This decision has historical echoes, as every major rate cut since the 1970s has been followed by a substantial 30% drawdown in the S&P 500. For the first time in recent history, Chair Powell’s alignment with market expectations signals a potential departure from the usual cautious stance. The market has responded positively, with the S&P 500 on track for its 9th green day out of the last 10, reflecting investor confidence in the Federal Reserve’s promises.

Inflation has eased from its highs without a spike in unemployment, which is good news, but inflation is still elevated, Federal Reserve Chair Jerome Powell said in his post-decision press conference on Wednesday.

The Dow Jones industrial Average jumped to a record Wednesday as the Federal Reserve signaled it would cut rates several times next year, satisfying investors who hoped the central bank would finally start to acknowledge the slowing trend of inflation with a less-aggressive monetary stance. The 30-stock Dow added 374 points, or 1%. At its high of the day, the Dow touched 37,057.81 to surpass 37,000 for the first time and exceed its previous all-time high in January of 2022. The S&P 500 jumped 1% with bank and real estate shares leading the way, while the Nasdaq Composite climbed 1%....

Be careful what you wish for, as the looming rate cut anticipated at the Fed’s March 20th meeting might not bring the desired outcome. History suggests that the first cut often aligns with a market decline, typically indicative of a slowing economy or crisis. Concerns are surfacing, especially in California, where tax receipts have plummeted by 25%, raising questions about an impending recession. The Legislative Analyst’s Office (LAO) report indicates a downturn in 2022, supported by the triggering of the Sahm Rule, even though applying it to states sparks controversy.

This crisis has unfolded by design, leading to significant shifts in market expectations and Fed policy. In a recent development, the 10-Year Note Yield has surged to 4.45%, a level not seen since November 2007. Markets have adjusted rapidly to this change, with rate cuts no longer being priced in until September 2024. Just three months ago, the expectation was for four rate cuts by the end of 2023, but now the possibility of another rate hike by December is back on the table, and rate cuts are not expected for a year. This shift indicates that the Fed is...

The Federal Reserve kept its benchmark lending rate unchanged at a two-decade high, but suggested at least one more increase is likely between now and the end of the year as inflation remains elevated and the economy continues to perform. The Fed's Open Markets Committee held its key policy rate at between 5.25% and 5.5%, the highest in 22 years, in a move that was widely expected from markets following a quarter point rate hike in July. The Fed's new Summary of Economic projections, known as the dot plots, now calls for GDP stronger growth of 2.1% this year, more...

The Federal Reserve voted to raise interest rates Wednesday by another 0.25 percentage points, brushing aside concerns about the financial sector and an expected recession later this year. The Fed’s rate-setting committee voted Wednesday to boost its baseline interest rate to a range of 5 to 5.25 percent, the point where Fed officials expected in March to stop hiking rates, according projections from the Fed’s last meeting. The latest rate hike is the tenth in a row since the Fed began its program of quantitative tightening in March of last year. Over the past 14 months, the Fed has boosted...

The Dow Jones Industrial Average fell 140 points, or 0.4%. The Dow was higher by 287 points earlier in the day. The S&P 500 declined 0.7%, while the Nasdaq Composite lost 1%. The Fed delivered a widely-anticipated 50 basis point rate hike at the conclusion of its December policy meeting. It’s a smaller bump from the prior four consecutive rate hikes of 75 basis points. A basis point is equal to one-hundredth of one percent.

Federal Reserve officials Monday continued to push for higher for longer interest to bring down inflation that is running hotter than previously anticipated. John Williams, president of the Federal Reserve Bank of New York, said Monday he expected inflation to moderate, but flagged drivers of underlying inflation, particularly in a red-hot labor market with “rapid” wage growth, as the most challenging. The New York Fed chief forecast core PCE, the Fed's preferred inflation measure, to slow from its current level of 5.1% to between 3% and 3.5% next year, driven by slowing global growth and fewer supply chain disruption. That,...

he Federal Reserve’s aggressive tightening policy has led the US dollar to appreciate to multi-decade highs, squashing currencies around the world. Now, a United Nations agency is warning that its actions, along with those of other central banks, risk pushing the global economy into recession. What’s happening: In a new report, the United Nations Conference on Trade Development (UNCTAD) said that tightening monetary policy, meant to fight inflation, could inflict worse damage globally than the financial crisis in 2008 and the Covid-19 shock in 2020.

The Federal Reserve on Wednesday raised its benchmark interest rate by 0.75 percentage point and signaled it plans to keep rates higher for longer as it tries to douse red-hot inflation. The Fed's target interest rate is now in the range of 3% to 3.25%, the highest level in 14 years. The bank's rate-setting panel also projected that the Federal Funds rate would hit 4.4% by year-end, up sharply from a projection of 3.4% in June, and 4.6% in 2023, up from a previous estimate of 3.8%.

Stocks fell in volatile trading Wednesday after the Federal Reserve raised rates by three-quarters of a point and forecast more sizable rate hikes in its fight against inflation, actions widely expected by traders. With the S&P 500 down more than 8% in the past month and 18% for 2022 heading into Wednesday’s Fed actions, stocks were already pricing in an aggressive tightening campaign by the Fed that could push the economy into a recession. The Dow Jones Industrial Average last traded 294 points lower, or 0.9%, after being up as much as 314 points. The S&P 500 dipped 0.7%, and...

The Federal Reserve on Wednesday enacted its second consecutive 0.75 percentage point interest rate increase as it seeks to tamp down runaway inflation without creating a recession.In taking the benchmark overnight borrowing rate up to a range of 2.25%-2.5%, the moves in June and July represent the most stringent consecutive action since the Fed began using the overnight funds rate as the principal tool of monetary policy in the early 1990s.

Federal Reserve Chair Jerome Powell answers questions after the FOMC decided to raise the federal funds rate by 75 basis points. Video at link

NEW YORK (Reuters) - U.S. stocks rallied on Wednesday and the Nasdaq posted its biggest daily percentage gain since April 2020 as the Federal Reserve raised interest rates as expected and comments by Fed Chairman Jerome Powell reassured investors. In addition, upbeat quarterly reports from Microsoft Corp and Alphabet Inc provided further encouragement about about the earnings season. The S&P 500 closed at its highest level since June 8. The Fed raised the benchmark overnight interest rate by three-quarters of a percentage point. The move came on top of a 75 basis points hike last month and smaller moves in...

The Federal Reserve on Wednesday raised interest rates by 75-basis points for the second-straight meeting as the need for speed to move monetary policy to a restrictive stance to curb above-trend inflation persists. The Federal Open Market Committee raised its benchmark rate to a range of 2.25% to 2.5% from 1.5% to 1.75% previously. In support of its goals - to achieve maximum employment and inflation at the rate of 2 percent over the longer run - the Fed said it "anticipates that ongoing increases in the target range will be appropriate." In the weeks leading up to the decision,...

The Federal Reserve on Wednesday raised its benchmark interest rate by 75-basis points for the first time in nearly three decades as policymakers intensify their fight to cool red-hot inflation, a move that threatens to slow U.S. economic growth and exacerbate financial pressure on Americans.

The Federal Reserve raised interest rates by three-quarters of a percentage point on Wednesday, its biggest move since 1994, as the central bank ramps up its efforts to tackle the fastest inflation in four decades. The big rate increase, which markets had expected, underlined that Fed officials are serious about crushing price increases even if it comes at a cost to the economy.

The Federal Reserve on Wednesday hiked interest rates by three quarters of a percentage point, its most aggressive move yet to try to control inflation, as it squeezes the U.S. economy.

Sometimes I wonder if The Federal Reserve Board of Governors pays attention to economic news. For example, the Atlanta Fed’s GDPNow forecast for Q2 was released today at -0.002%. So what does The Fed do? They raised their target rate by 75 basis points to 1.75%. Apparently, The Fed has chosen to fight inflation rather than help the economy. The Fed has chosen poorly.