The FED finally announced its interest rate decision after the FOMC meeting that ended today.
The FED left interest rates constant. The expectation was in this direction.
All eyes are now on FED Chairman Jerome Powell's press conference, which will start at 22:30 Turkey time (UTC+3).
Here is Bitcoin's reaction after the FED decision:
- Most FED officials predict a rate cut in 2024.
- A 75 basis point interest rate cut is anticipated in 2024.
- Additional tightening will be considered when necessary.
- US interest rate futures are pricing in a more than 100 basis point rate cut in 2024 following the Fed decision, little changed from before the Fed statement.
- FED inflation expectation; It was reduced from 2.5 to 2.4 for 2024. It was reduced from 2.2 to 2.1 for 2025. It kept it at 2.0 for 2026.
But all eyes will be on the FED's forecasts for the economy, inflation and especially interest rates. Although futures markets are predicting four to five quarter-point rate cuts in 2024, the Fed will likely make just two rate cuts, according to Goldman Sachs and Barclays. This is roughly in line with the Fed's forecast in September, although that forecast assumed a final hike this month.
On the other hand, the US economy is expected to grow at a rate below 2% in the last three months of the year and in 2024, following the rapid growth in the third quarter. Job gains and wage growth also remain strong, though modest. Moody says this should give the Fed confidence that there won't be a rise in wages that would reignite inflation.
The Fed today is likely to slightly lower its forecast for its preferred annual inflation measure, called PCE, even as it raises its 2024 growth forecast to 1.6% and lowers its unemployment rate forecast to 4% by the end of next year, from 3.7% currently, according to Goldman. It will reduce to 2.5% by the end of next year.
*This is not investment advice.