An important FOMC meeting coming up today (5 hrs) . The FED | Fat Pig Signals

An important FOMC meeting coming up today (5 hrs) .

The FED has a tough decision to make as they need to :

- further tame inflation by raising interest rates by another 25bps

- consequently, an increase in interest rates will put more pressure on U.S banks , likely leading to more defaults .

Our take : we can expect the FED to hike interest rates by 25bps regardless , however , there’s a decent chance that they’ll mention an end to this hiking cycle (contraction) .

This would likely result in some huge volatility in the market .

Going forward , we can still hold the same bias ; depending on the context provided during the meeting , we can further asses .


In the situation of :

*sorted from most / least likely*

- 25bps hike : likely priced in , prices neutral depending on the context provided as mention above

- pause : market likely to rally

- 50 bps hike : markets would see some decline

- interest rate cut : market rally


More news to follow