A Singular Obsession
The Federal Reserve Open Market Committee raised its target for overnight interest rates by 0.25% to a range of 4.50–4.75%, the eighth consecutive meeting at which it raised rates for a total of 4.50% of tightening.
- The Federal Reserve raised its target for overnight interest rates by 0.25% to a range of 4.50–4.75%, the smallest hike since March 2022
- Today’s increase will probably be followed by a pause in March, contingent on two CPI reports confirming slowing price pressures
- There seems to be a singular obsession—misguided in our view—about how financial conditions transmit into real economic activity
- FOMC statement retained the expectation of further rate hikes, but did acknowledge early signs of slowing inflation pressures
We find it likely that, pending cooperation from two months of jobs and CPI data scheduled for release before the next FOMC meeting, the Fed will follow today’s hike with a pause in the tightening cycle—policymakers just aren’t allowed to say it yet.
This report is produced by the Janney Investment Strategy Group (ISG). It is the intellectual property of Janney Montgomery Scott LLC (Janney) and may not be reproduced, distributed, or published by any person for any purpose without Janney’s express prior written consent. This report is to be used for informational purposes only. In no event should it be construed as a solicitation or offer to purchase or sell a security. The information presented herein is taken from sources believed to be reliable, but is not guaranteed by Janney as to accuracy or completeness. Any issue named or rates mentioned are used for illustrative purposes only, and may not represent the specific features or securities available at a given time. Preliminary Official Statements, Final Official Statements, or Prospectuses for any new issues mentioned herein are available upon request. The value of and income from investments may vary because of changes in interest rates, foreign exchange rates, securities prices, market indexes, as well as operational or financial conditions of issuers or other factors. Past performance is not necessarily a guide to future performance. For investment advice specific to your situation, or for additional information on this or other topics, please contact your Janney FA and/or your tax or legal advisor.
About the author
