Sino-Singapore Jingwei reported on September 23 that at 2 a.m. Beijing time on September 23, the Federal Open Market Committee announced that the target range of the federal funds rate would remain unchanged at 0-0.25%, which was in line with market expectations.
After the Federal Reserve signaled that it might reduce debt purchases and raise interest rates as early as next year, US stocks rebounded from the decline since September.
According to the "Wall Street Journal" report, Fed Chairman Powell said that as early as the next meeting on November 2 to 3, it may begin to reduce the $120 billion monthly asset purchase plan, and may raise interest rates next year.
If progress is generally in line with expectations, the committee judges that the pace of asset purchases may soon slow down.
According to a Reuters report, the Fed hinted that the rate of interest rate increase may be faster than expected due to the strengthening of the policy momentum to get rid of the pandemic crisis.
Reuters reported that the Fed hopes to end the purchase of US Treasury bonds and mortgage-backed securities before it starts raising borrowing costs, and new forecasts show that officials are ready to achieve this goal by 2022.
A new policy statement and economic forecast indicate a slight hawkish tendency-9 out of 18 Fed officials are preparing to raise interest rates next year in response to inflation.
The Fed believes that this year's inflation rate will reach 4.2%, more than twice its target.
The report pointed out that for now, the Fed is still expected to stimulate employment while curbing inflation.
Powell said that even if the Fed stops buying assets, financial conditions will remain accommodative, and emphasized that the decision on the bond purchase plan is separate from any action on interest rates.
Analysts said that overall, the Fed’s statements and forecasts “may be a bit more hawkish than many people expected, basically acknowledging that if the economy continues to grow as we have seen, it needs to be scaled down.
The dot plot shows that there are 9 committee members who are expected to raise interest rates at least once in 2022, an increase of 2 over the previous period, and the market is expected to increase by 1-3.
Seventeen of the 18 committee members believed that the Fed would raise interest rates at least once in 2023, and 13 predicted that interest rates would be higher than 0.5% (2 hikes), and 5 predicted that interest rates would be higher than 1%.
After the Fed’s statement, the three major US stock indexes all closed higher that day, and the S&P 500 and Dow Jones index rose for the first time after experiencing four consecutive declines.
As of the close, the Dow rose 1.00%, the S&P index rose 0.95%, and the Nasdaq index rose 1.02%.
(Zhongxin Jingwei APP)