Fed Hikes Rates by 75 bp to Curb Inflation. What’s Next for Gold, USD & Bitcoin?

[MongiIG]

FOMC RATE DECISION KEY POINTS:

• Federal Reserve raises its benchmark rate by 75 basis points to 3.00%-3.25%, in line with market expectations
• Policymakers downgrade their GDP estimates, while revising upwards the inflation outlook
• The September dot-plot signals a more hawkish tightening path than envisioned in the June Summary of Economic Projections

 

 

FOMC POLICY STATEMENT

The statement offered a downbeat message on economic activity, noting that spending and production indicators are showing modest growth.

On the labor market, the document stressed that the unemployment remains low, acknowledging that job gains remain strong, providing a vote of confidence in the outlook.

The central bank reiterated that inflation is high, reflecting supply and demand imbalances related to the coronavirus health crisis, rising food and energy costs, and broader price pressures. In addition, the bank said it continues to be attentive to inflation risks.

On monetary policy, the FOMC maintained the same forward guidance as previous statements, indicating that ongoing increases in the target range will be appropriate, signaling policymakers are not yet done with aggressive hikes.

 

 

Full article: Sep 21, 2022 | DailyFX
Diego Colman, Market Analyst