Poll:next change in Federal Funds Rate

[dobig]

Well, that is exactly the Fed playbook for a faltering economy.

But not sure how a 25 bp cut after 500 bp of rises creates an inflation problem .

You'll have to give me some slack here as I'm pretty green. What I've been seeing is equities rally at even the slightest hint of any economic indicator signaling a lowering of inflation and the hopeful Fed pivot. It would seem once we actually pivot and start seeing the Fed reverse course and lower rates, that whole, "don't fight the Fed" mantra will come back in full force. Equities will rally, everyone will cheer and prices will start pushing back up.


Anyways, that's what my untrained eyes see.

 

[Montecfo]

You'll have to give me some slack here as I'm pretty green. What I've been seeing is equities rally at even the slightest hint of any economic indicator signaling a lowering of inflation and the hopeful Fed pivot. It would seem once we actually pivot and start seeing the Fed reverse course and lower rates, that whole, "don't fight the Fed" mantra will come back in full force. Equities will rally, everyone will cheer and prices will start pushing back up.





Anyways, that's what my untrained eyes see.

I think you are right.
But stock market rallies do not mean runaway inflation. For most of the past 10-15 years we had stocks rallying and low inflation.

 

[ShokWaveRider]

We think the decrease voters are wishful thinkers. It will more likely stay the same than decrease. Remember Powell saying hold for a significant time.

 

[Montecfo]

We think the decrease voters are wishful thinkers. It will more likely stay the same than decrease. Remember Powell saying hold for a significant time.

He also said interest rates will stay low through 2023. Some have perhaps forgotten this.

Bottom line: the Fed is trustworthy about one meeting out. They have no idea when they will cut. It depends on the economy which continues to slow.

"Fed expects to keep it's key rate near zero through 2023"

https://apnews.com/article/fed-expe...through-2023-9b9a335a1ce05d69fc97a1d6197371ab

 

[Aerides]

He also said interest rates will stay low through 2023. Some have perhaps forgotten this.

Bottom line: the Fed is trustworthy about one meeting out. They have no idea when they will cut. It depends on the economy which continues to slow.

"Fed expects to keep it's key rate near zero through 2023"

https://apnews.com/article/fed-expe...through-2023-9b9a335a1ce05d69fc97a1d6197371ab

That article is now 26 months old and the environment changed significantly. You can argue (and most of us do) that the Fed didn't see sustained inflation coming, and should have acted sooner, but to argue they can't be "trusted" because their forecasting was off, eh...

 

[Montecfo]

That article is now 26 months old and the environment changed significantly. You can argue (and most of us do) that the Fed didn't see sustained inflation coming, and should have acted sooner, but to argue they can't be "trusted" because their forecasting was off, eh...

Of course it did. But the Fed had no idea then what it would do in 2023. Understand they had same promise for 2022. That did not age well.

And any individual governor saying they won't cut in 2023 is speculating. They will make those decisions based on conditions at that time.

You can't trust their forward looking statements.

I just wish they would stop talking so much. They undermine the message.

 

[Acollector]

Third option? ….. HOLD

Really need the third option which is HOLD…..

 

[Sirka]

I voted increase...after a pause. Inflation is sticky for sure and I don't talk about the cost of lumber. I just don't see 99 cent menus coming back.

 

[W2R]

Did not vote - The Poll needs a "Hold as is" or "Stay the Same" as that is where I think it will be.

And how about "I don't have the slightest clue!!!" as that would be my chosen answer.

 

[mickeyd]

I voted increase, but the true response is PAUSE.

 

[GenXguy]

But as explained earlier, the question was about the next "change". So, a pause, hold, or "no change" would NOT be a change and could not be valid responses to the next "change".

 

[Earl E Retyre]

This poll reminds me of an old post ... why you can never successfully add a poll to this forum

https://www.early-retirement.org/forums/f27/poll-pick-a-number-between-1-and-10-a-84534.html

 

[audreyh1]

Well the Fed has voted on the poll and they vote another hike or two in 2023 - so increase.

 

[socca]

Exactly. This isn't a poll regarding the interest rate decision at the next meeting of the FOMC. There will indeed be three options at that meeting: no change, increase, or decrease.

Since the current consensus prediction for the June FOMC meeting seems to be "no change", I didn't bother running a poll for this - not very interesting.

Congrats to the numerous forum folks who back in May predicted that the next change in the federal funds rate (whenever it might occur) would be an increase. That certainly wasn't the chatter on the Street back then.

The latest chatter is for (perhaps) one more increase, an extended freeze, and then a decrease. Should be interesting to watch.