3 Things to Watch at Wednesday’s Fed Meeting and Powell’s Likely Last Conference as Chair

Summary

The Federal Reserve is expected to hold its federal-funds target range at 3.50%–3.75% for the third straight meeting, making the policy decision a non-event. The focus will be on Powell's comments and the potential implications for future rate decisions. This meeting is likely Powell's last as Chair, adding to the significance of his statements.

Market Impact

The expected rate hold will likely have a neutral impact on markets, with minimal effects on asset prices. However, Powell's comments may influence market sentiment, potentially affecting stocks, bonds, and the US dollar. A lack of surprises could lead to a low-volatility environment, while any hints at future policy changes could spark market reactions.

Key Drivers

• Federal Reserve's policy decision
• Powell's comments on future rate decisions
• Implications for market sentiment

Risks

• Unexpected changes to the federal-funds target range
• Surprising comments from Powell that alter market expectations

Time Horizon

Short Term