FOMC Palpitation is getting more and more felt! These Facts Are Attention Markets

<p>&nbsp;The United States Central Bank (Fed), is expected to keep interest rates unchanged for the second policy meeting in a row. This marks the end of a nearly two-year rate hike campaign. These changes in monetary policy reflect favorable economic conditions, including lower inflation and strong job growth, consumer spending, and strong economic growth.</p><p><br /></p><p>Despite slowing inflation and strong economic growth, Powell and other Fed officials, including Christopher Waller, a member of the Fed's governing board, did not rule out the possibility of a final rate hike. Michael Arone of State Street Global Advisors emphasized the importance of the Fed's tough approach to inflation.</p><p><br /></p><p><br /></p><p>Since March 2022, the Fed has increased its key rate from near zero to about 5.4% in response to the highest inflation in four decades in 2022. This action has affected mortgages, car loans, and credit card debt. As a result, the average 30-year fixed mortgage interest rate has risen nearly 8%. Even with these measures, annual inflation has fallen from a peak of 9.1% to 3.7%.</p><p><br /></p><p>US economic growth picked up in the July-September quarter due to strong consumer spending and rising wage rates. However, volatile financial markets have resulted in higher long-term rates on US Treasury bonds, lower stock prices, and higher corporate borrowing costs.</p><p><br /></p><p>Wall Street economists recommend that this market trend will likely lead to an economic slowdown and ease inflationary pressures without additional rate hikes. The rate of return on the 10-year Treasury note has reached 5%, a level not seen in 16 years, due to a surge in Treasury note yields.</p>