At 11AM PST on November 1st, the Federal Reserve announced that their interest rate would not be increased for the 2nd straight month. Treasury Notes moved lower during the follow-up address by Chairman Jerome Powell. The 2-Year dipped below 5% for the first time since October 10th. A summary of comments by J. Powell follows:
- Inflation has moderated
- Getting inflation to 2% has a long way to go
- Labor supply & demand continue to come into better balance
- The full effects of tightening have yet to be felt
- The economy has expanded well above expectations
- The labor market remains tight
- Could warrant further tightening
- A few months of good inflation data is only the beginning
- We still have a long way to go to get to their 2% objective
- We are not confident that the policy is sufficiently restrictive
- Tight policy is putting downward pressure on inflation
- Inflation is painful for people without financial resources
- They are committed to reaching their 2% inflation objective
Are more rate hikes in the cards for 2023 and beyond? And when might the Fed actually reduce interest rates? Some are estimating mid-2024, but most feel it will be at least until the end of 2024 prior to any reductions.
