Jump to content

The Fed is likely to signal a March interest rate hike and that further policy tightening is coming


Recommended Posts

The Fed is likely to signal a March interest rate hike and that further policy tightening is coming
PUBLISHED TUE, JAN 25 2022 by Patti Domm CNBC
image.png

KEY POINTS:

  • The Federal Reserve is expected to signal at its meeting this week that it is ready to raise interest rates as soon as March and that it will consider other policy tightening.
  • The Fed issues its policy statement Wednesday afternoon, at the end of its two-day meeting, and it is expected to show that it is willing to take the steps necessary to fight inflation.
  • “I don’t think they’re going to be spooked by this,” said one strategist of the stock market’s correction. “They need to tighten financial conditions so they can have a better handle on inflation.”


The Federal Reserve is expected to signal at its meeting this week that it is ready to raise interest rates as soon as March and that it will consider other policy tightening, reversing the easy policies it put in place to fight the pandemic.

The Fed begins its two-day meeting Tuesday, and on Wednesday afternoon, the central bank is expected to issue a new statement that shows it is resolved to fight inflation. Against the backdrop of a violent stock market correction, Fed officials are expected to say they are ready to push up the fed funds rate from zero as soon as March.

“We don’t expect them to sound dovish,” said Mark Cabana, head of U.S. short rate strategy at Bank of America. “The [bond] market seems to be reacting to the drop in equities, plus the geopolitical tensions, so maybe the Fed sounds not as hawkish as they otherwise would have. But we don’t think the Fed is going to come out and tell the market it’s wrong for pricing in four rate hikes this year.” For more on this CNBC

Link to comment

WORLD ECONOMY
IMF sees potential for further market turbulence as central banks hike rates

PUBLISHED THU, JAN 27 2022 by Karen Gilchrist CNBC
image.png

The International Monetary Fund has warned of further turbulence ahead for financial markets, particularly as governments around the world shift gears into recovery mode.

Central banks’ moves to tighten monetary policy and curb rising inflation could push riskier stocks deeper into the red even as policymakers pledge a smooth transition, the IMF’s Tobias Adrian, financial counsellor and director of monetary and capital markets, told CNBC’s Geoff Cutmore. Full article on CNBC

Link to comment

image.png

image.png

Facing both turbulent financial markets and raging inflation, the Federal Reserve on Wednesday indicated it could soon raise interest rates for the first time in more than three years as part of a broader tightening of historically easy monetary policy.

In a move that came as little surprise, the Fed’s policymaking group said a quarter-percentage point increase to its benchmark short-term borrowing rate is likely forthcoming. It would be the first rise since December 2018.

 

Chairman Jerome Powell added that the Fed could move on an aggressive path. Full article CNBC

Fed decision January 2022: Federal Reserve points to interest rate hike  coming in March

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • General Statistics

    • Total Topics
      22,987
    • Total Posts
      95,310
    • Total Members
      43,595
    • Most Online
      7,522
      10/06/21 10:53

    Newest Member
    Mamzy
    Joined 23/09/23 05:19
  • Posts

    • Bitcoin and other major crypto experienced a dip in value on Thursday, erasing gains made earlier in the week. The decline came after the Federal Reserve signaled that interest rates would remain high for an extended period, with Bitcoin retreating 2.3% to $26.5K. Despite the bearish pressure,  the founder and CEO of Bitcoin joint mining company Xive,  Didar stated that the stagnant rate increase is positive for Bitcoin. He suggested that this could reduce the attractiveness of mainstream financial assets to institutional investors in the long term, potentially driving a new rally in Bitcoin's price. Major altcoins and exchange tokens also struggled on Thursday, with ETH changing hands at $1,585, down about 2.6% from Wednesday. Other altcoins such as BNB and BGB also experienced losses. Despite these challenges, some analysts believe that Bitcoin is likely to remain within its recent range between $25,000 and $30,000. Riyad from digital asset data platform Kaiko, noted that the market needs a catalyst to mount any serious rally.  What are your thoughts? 
    • Traditional banking systems served as the gatekeepers of financial services for long, dictating how people access loans, save, and invest in opportunities. Typically controlled by a centralized system with a single authority such as a bank or government in total charge, this centralization is limited by high fees, restricted accessibility and slow transaction speed. Dentralized finance, DeFi, got introduced as a blockchain-based financial system that removes intermediaries or central authorities, and utilizes smart contracts instead. By eliminating intermediaries, DeFi delivers core benefits like improved accessibility into the financial system for everyone having internet connection regardless of their location. DeFi is also valued for its transparency. While traditional banking system often deny customers audits on how their assets are being managed, DeFi, through the help of blockchain allows anyone access to tracking and auditing transactions, thereby raising trust. Furthermore, DeFi also offers various financial services and products like DEX, lending and borrowing, stablecoins etc, all known to proffer varied innovative solutions, while operating 24/7 in contrast to traditional finance. DeFi isn’t flawless as issues like insecurity, lack of consumer protection etc are still prevalent; however, the growth of DeFi has been impressive; since its introduction, the total value locked in DeFi protocols has grown significantly indicating that the demand for DeFi services is fast growing. DeFi seems to be redefining financial industry by offering an alternative to traditional banking systems. With the increasing adoption, can we expect to see an overhaul in the way we access financial services?        
    • Leverage is good but please use it according to your risk management system coz the higher the leverage the higher the risk, I trade my perpetual futures on Bitget tho, the exchange offers high leverage but I only use according to my risk management system.
×
×
  • Create New...
us