FOMC Meeting and Rate Decision Announces Wednesday at 2:15 p.m. EST
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Announcement:
The FOMC Meeting/Rate Decision is to be announced at 2:15 p.m., on Wednesday, June 25th.
Description:
The FOMC meeting is where the Federal Reserve Presidents from the 12 districts meet to discuss the present state of the U.S. economy, and determine if U.S. open market operations need to add, or subtract liquidity via the interest rate policy of the Fed Funds Rate and Discount Rate, while also directly adding banking liquidity, if need be.
Trader Take:
The simple fact of the matter is this: Raising rates at this time – despite inflation fears – would significantly impede any hope of bolstering the U.S. economy. Metaphorically, it would be ridiculous to take the crutches away from a man with a broken leg just because he’s had the cast on for several months. Obviously, it’s vital to wait for the broken bone to fully heal.
While the FOMC would like to raise rates, the move could sink the slight amount of recovery that has surfaced, and thus, Wall Street will likely see rates held steady at 2%. However, the true meat of the decision isn’t the actual rate itself, but the language issued within the statement. Traders will be dissecting the statement very carefully for any hints as to the future of rates.