Futures invariably await Fed’s decision on rate
2022.12.14 07:14
Futures invariably await Fed’s decision on rate
Budrigannews.com – On Wednesday, U.S. stock index futures were muted as investors avoided large bets ahead of the much-anticipated decision on interest rates made by the Federal Reserve.
The fed funds rate is widely anticipated to rise by half a percentage point to 4.25-4.50%. At 2 p.m. ET (1800 GMT), the decision will be made, and Chair Jerome Powell will hold a press conference afterwards.
Tuesday’s data showed that consumer prices in the United States increased in November at the slowest rate in about a year. This sparked an early rally on Wall Street, which saw prices rise as much as 2.8% to a three-month high.
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Concerns about the central back remaining aggressive led, however, to the benchmark index closing sharply below its high.
In a note, BCA Research stated, “This CPI release ultimately cements the case for a downshift in the pace of Fed rate hikes on Wednesday.”
“Even though it increases the likelihood of a pause in H1, labor market dynamics remain too hot to call for rate cuts in the near term,” the statement reads.
Morgan Stanley (NYSE:) strategists are anticipating that the central bank will raise rates by 25 basis points more at its meeting in February, but that there will be no further increases in March, resulting in the peak fed-funds rate remaining at 4.625 percent.
Money market participants, on the other hand, anticipate two additional 25 basis point increases next year, maintaining a terminal rate of 4.82 percent by May 2023.
We were down 1 point, down 1.25 points, or 0.03%, and down 10.75 points, or 0.09%, at 6:06 a.m. ET.
In the stock market, Tesla (NASDAQ:) In premarket trading, Inc. fell 1% following a Goldman Sachs (NYSE:) The price target for the maker of electric vehicles’ stock was lowered by an analyst.
