November’s FOMC meeting was going to be a non-issue from the moment it was scheduled.

  • The Federal Reserve held steady its target for overnight rates to a range of 0 – 0.25%, unchanged now four meetings and more to come
  • There were no material policy changes, and we continue to anticipate zero interest rates through 2022, possibly longer
  • Language in the FOMC statement was almost entirely unchanged, but retains the very cautious tone set back July’s FOMC meeting
  • There is nothing in the statement to suggest the FOMC will terminate (pending Treasury Dept. approval) corporate or muni lending facilities

The meeting is sandwiched between two of the bigger data points this fall, the November Presidential election (results pending), and the October jobs report, due Friday. Given the Fed’s long-running apolitical history, there is no reason to expect policy action that close to an election. And given the improving, though noisy, jobs landscape, there is only limited reason to expect action immediately before more data on the topic. Two pieces of bread, one Fed. That Fed left rates unchanged and its bond-buying programs unchanged at $80 billion per month. Definitely a ham on rye, no spicy mustard.

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About the author

Guy LeBas

Director, Custom Fixed Income Solutions

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