US: Fed is widely seen keeping its rates unchanged – UOB

Economist at UOB Group Lee Sue Ann comments on the upcoming FOMC event later on Wednesday.

Key Takeaways

While Fed Chair Jerome Powell’s speech at Jackson Hole had a hawkish tint, it was also balanced with the explicit acknowledgement that monetary policy is restrictive. Retaining the policy optionality is not the same as committing to more rate hikes (which was the message in last year’s speech).

As such, we reaffirm our stance the Fed will be on pause for the upcoming Sep FOMC and for the rest of 2023, with the terminal FFTR level at 5.25-5.50%.