At today’s FOMC meeting, on top of not changing the Fed Fund’s target range, we would like to point out the following:
- The meeting statement contained very few changes to the December language, noting only that household spending is rising at a “moderate” rate (vs December’s “strong”) and that the committee sees policy as appropriate to support inflation “returning to” (vs “near) its 2% target. The vote was unanimous.
- The FOMC said it will continue to conduct overnight repo operations at least through April 2020 in order to ensure a supply of ample reserves.
- It also voted unanimously to raise the IOER rate to 1.60% to help foster trading in the Fed funds market at rates within the target range.
If anything interesting comes out of the press conference we will pass along. Ultimately, the Fed remains stimulative and that should help buffer any pullbacks that emerge.
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