Main Topic: Federal Reserve officials express concern about inflation and suggest more rate hikes may be necessary.
Key Points:
1. Inflation remains above the Committee's goal, and most participants see significant upside risks to inflation.
2. The recent rate hike brought the federal funds rate to its highest level in over 22 years.
3. There is uncertainty about the future direction of policy, with some members suggesting further rate hikes and others cautious about the impact on the economy.
### Summary
Gold prices have continued to decline due to rising US treasury yields and a stronger dollar. The FOMC meeting minutes revealed concerns about inflation and the potential need for additional interest rate hikes. The outlook for gold prices remains subdued ahead of Federal Reserve Chair Jerome Powell's upcoming speech.
### Facts
- 📉 Gold prices have declined for the fourth consecutive week, breaking below the significant threshold of $1,900 per troy ounce and reaching their lowest point since March 2023.
- 📈 The continuous rise in US treasury yields and the dollar index has contributed to the decline in gold prices.
- 📊 US economic indicators, such as retail sales and manufacturing production, have outperformed expectations, highlighting resilient consumer spending and propelling the dollar index.
- 💸 The FOMC meeting minutes revealed concerns about inflation and the potential need for additional interest rate hikes, although two Fed officials favored keeping rates unchanged or pursuing a rate cut.
- 🇨🇳 Weakening sentiment in China and diverging monetary policies have also contributed to the strengthening dollar.
- 📆 The upcoming week will focus on flash manufacturing PMI figures and the Jackson Hole Economic Symposium, where Federal Reserve Chair Jerome Powell is scheduled to address the economic outlook.
### Potential Implications
- ⬇️ Gold prices are expected to remain subdued in anticipation of Powell's speech, as elevated yields and a stronger dollar continue to impact the market.
Federal Reserve Chairman Jerome Powell will likely provide updates on the central bank's stance on interest rates in the US during the Jackson Hole meeting, although an announcement regarding the end of interest rate hikes is less likely due to positive economic data and the potential risk of triggering another crisis.
Two officials at the Federal Reserve have expressed differing views on whether or not the central bank should raise its benchmark interest rate again to combat inflation, highlighting the uncertainty surrounding future rate hikes, with more clarity expected from Federal Reserve Chair Jerome Powell's upcoming speech at a Fed conference in Jackson Hole.
Federal Reserve Chair Jerome Powell is expected to signal in his upcoming speech that the Fed plans to maintain its benchmark interest rate at a peak level for a longer period than anticipated, suggesting that any rate cuts are unlikely until well into next year, as the central bank aims to further slow borrowing and spending to reduce inflation.
The stock market rally attempt experienced a setback as the S&P 500 and Nasdaq saw a downside reversal, indicating that the correction is still ongoing, while retailers faced challenges and Treasury yields reached a 15-year high. Meanwhile, Federal Reserve Chair Jerome Powell warned of potential rate hikes due to high inflation.
Fed Chair Jerome Powell reiterated that the Fed's inflation target will remain at 2% and that they are prepared to raise rates further if necessary, despite concerns of an economy that has re-accelerated above expectations.
Federal Reserve Chair Jerome Powell stated that the strength of the U.S. economy may require further interest rate hikes to reduce inflation, despite uncertainties surrounding the economic outlook.
Traders interpret Federal Reserve Chairman Jerome Powell's speech as an indication that the Fed will continue to raise interest rates and that the US economy remains strong.
Federal Reserve Chairman Jerome Powell signaled at a conference of central bankers that more rate hikes could be on the way as the economy continues to run hot, despite a series of policy tightening measures, in an effort to combat persistent inflation.
The Federal Reserve's preferred inflation gauge increased slightly in July, suggesting that the fight against inflation may be challenging, but the absence of worse news indicates that officials are likely to maintain interest rates.
The Reserve Bank of Australia is expected to keep its key interest rate unchanged at 4.10% as inflation slows, but economists anticipate a final hike in the next quarter.
The Federal Reserve is expected to maintain one more rate hike on the table in their updated forecasts, despite their growing faith in the prospect of an economic soft-landing.
The Federal Reserve is expected to keep interest rates unchanged at its upcoming meeting, but market participants will be closely watching for any hints regarding future rate cuts.
The Federal Reserve is expected to signal that another rate hike may be necessary due to strong economic growth and inflation metrics, creating a difference of opinion between the equity and bond markets.
The Federal Reserve is expected to keep interest rates steady as it waits for more data to gauge the impact of previous rate hikes on the US economy, with factors such as inflation, the job market, and rising energy prices adding uncertainty.
The Federal Reserve's decision to leave interest rates unchanged means that savers and individuals with surplus cash have the opportunity to earn a higher return on their money than in recent years, with online banks offering high-yield savings accounts that can provide a return above inflation.
The Federal Reserve chairman, Jerome Powell, stated that despite current macroeconomic challenges, the central bank will continue with its rate increases and not consider cutting rates due to the stimulus money provided by Congress.
The Reserve Bank of India is expected to maintain its policy rates at the upcoming monetary policy review meeting due to high retail inflation and the US Federal Reserve's hawkish stance.
The Reserve Bank of India (RBI) is expected to keep the benchmark interest rate unchanged at 6.5% in its upcoming monetary policy review due to elevated inflation and global economic factors.
The Federal Reserve remains committed to raising interest rates despite the rise in U.S. bond yields, as the U.S. economy shows signs of re-accelerating in the third quarter and inflation worries ease.
Federal Reserve officials indicate that monetary policy will remain restrictive for a while to bring inflation back to 2%, but there is ongoing debate over whether to increase rates further this year.
Wall Street and policymakers at the Federal Reserve are optimistic that the rise in long-term Treasury yields could put an end to historic interest rate hikes meant to curb inflation, with financial markets now seeing a nearly 90% chance that the US central bank will keep rates unchanged at its next policy meeting on October 31 through November 1.
The Federal Reserve officials were uncertain about the future of the economy and decided to proceed with caution in their interest-rate policy, weighing the risks of overtightening versus insufficient tightening. They were divided on the frequency of rate hikes, with a majority supporting one more increase, but some feeling that the policy rate was nearing its peak. The recent spike in long-term bond rates has led to speculation that the Fed may not raise rates again this cycle.
The Federal Reserve officials are uncertain about the U.S. economy's outlook and plan to proceed cautiously in deciding whether to raise interest rates, with some acknowledging the risks of raising rates too high or not enough to curb inflation.
Federal Reserve Chair Jay Powell may suggest that the responsibility of bringing down inflation should be shifted from the Fed to the market, indicating that rates may need to stay higher for longer and potentially tightening financial conditions and slowing the economy.
The markets have misunderstood recent statements from Fed officials, leading to the belief that higher interest rates have already done their job, when in fact the Fed may need to raise rates again if the strong US economy continues to drive rates higher.
The U.S. Federal Reserve is expected to keep its key interest rate unchanged on November 1 and may delay rate cuts until the second half of next year, according to a Reuters poll of economists.
Federal Reserve Chair Jerome Powell will deliver remarks in New York suggesting that interest rates will remain unchanged at the next meeting, despite uncertainty surrounding future rate decisions.
Federal Reserve Chair Jerome Powell's upcoming remarks at the Economic Club of New York may provide insight into the central bank's strategy on interest rates, potentially affecting the market and indicating if the Fed agrees with recent speakers who believe rate hikes are over.
Federal Reserve Chair Jerome Powell indicated that the strength of the U.S. economy and tight labor markets could warrant further interest rate increases, countering market expectations that rate hikes had come to an end. Powell also acknowledged that inflation is still too high and further rate increases could be necessary.
