Highlights of the FOMC decision on April 27, 2016:
The Federal Reserve opted to leave the Fed Funds Rate in the range of 0.25% to 0.50%, as expected by every economist polled by Bloomberg and overwhelmingly priced into markets.
The intrigue regarding the decision was whether or not the statement would contain a hint about what the Federal Reserve may do in June. Ahead of the decision, markets were pricing in a 21.6% chance of a June hike, 33.9% of a July hike and 66.1% chance of a hike in December or sooner.
- Removes reference to global events posing risks to outlook
- Labor market improved even amid signs of slower growth
- Repeats that policy stance remains accommodative
- No assessment on the balance of risks
US dollar much higher on the kneejerk on the financial risks receding but I think that repeat about accommodative might be under-appreciated.
More highlights:
- Will closely monitor inflation indicators and global/financial market developments
- George dissented again, no others
- Household spending has moderated but real incomes have risen at solid rate
The rest of the statement is the same.