FOMC Roundup: Fed Reconsiders Rate Cuts as Inflation Forecast Drifts Higher

Fed trims rate cut bets as inflation forecast rises. USD reclaims ground on hawkish projections, while US equities rally on lower yields despite hotter inflation outlook

2024-06-12 15:40:42US equities rally on lower yields, USD despite the hotter inflation outlookFederal reserve members were allowed the opportunity to revise their individual interest rate outlooks after May’s inflation data was released just hours before the two-day meeting was due to conclude on Wednesday.

Markets brought a second rate cut back onto the table after the CPI print yesterday but that was thrown into doubt after the Fed projections where it remains a strong possibility but Is no longer fully priced in., which sold off after the French President Emmanual Macron announced a snap election scheduled for the end of this month. This theme may re-emerge once the CPI data appears in the rear-view mirror and we get closer to the election.

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