As expected, the Fed did nothing at today’s FOMC meeting. A hike is on the way in December.
Take a gander at the opening paragraph in today’s FOMC Statement.
Information received since the Federal Open Market Committee met in September indicates that the labor market has continued to strengthen and that economic activity has been rising at a strong rate. Job gains have been strong, on average, in recent months, and the unemployment rate has declined. Household spending has continued to grow strongly, while growth of business fixed investment has moderated from its rapid pace earlier in the year. On a 12-month basis, both overall inflation and inflation for items other than food and energy remain near 2 percent. Indicators of longer-term inflation expectations are little changed, on balance.
Key Points
Fed Action
Nothing
Bond Market Reaction
The reaction is a bit of steepening from the perspective of the 3-month yield but a bit of flattening from the perspective 2-year and 5-year to the 30-year long bond.
