Fed to Deliver Second Consecutive 'Hawkish Pause': Will the Market Buy It Again?
Following the European Central Bank (ECB)'s decision to conclude its string of consecutive interest rate hikes and maintain its rates at the current level, the financial world's attention has shifted to the Federal Reserve.
In alignment with the ECB's recent stance, the Federal Reserve is widely anticipated to keep its rates steady in the upcoming decision.
This expectation is substantiated by the strong consensus reflected in the Fed Rate Monitor Tool, which now indicates an overwhelming likelihood of 94.5%, marking a slight decrease from the previous week's 97.8% reading.
However, what holds the most significance in this scenario is not just the prospect of a second consecutive pause but also the content of Jerome Powell's forthcoming speech. So, what should we anticipate from his address?
Realistically, I don't foresee any groundbreaking revelations, and I regret to disappoint those who may be hoping for any dramatic or abrupt changes.
We can generally anticipate a conventional Powell, where he reiterates the following key points:
Beyond these points, there is unlikely to be any substantial deviation from the usual rhetoric.
Meanwhile, around 44% of the companies listed on the S&P 500 have released their earnings reports.
It appears that the trend is affirming a positive direction and that the preceding quarter marked the low point, indicating that, thus far, U.S. companies are maintaining their resilience effectively.
Source: Charlie Bilello
As for Treasury yields, after reaching new highs, they appear to be retracing, with the 10-year yield well below 5 percent and the 2-year yield slightly above, but only marginally so.
All eyes will remain on Powell's words, making today an intriguing day for the markets.
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Dis
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