Federal Reserve hikes rates by basis points 75, as expected

The FOMC statement from the June 14-15, 2022 meeting is out along with the updated economic forecasts. The market was pricing in an 87% chance of a 75 basis point hike with the remainder on 50 bps. Out the Fed funds futures curve, the terminal top was in May 2023 at 3.982% with a path of 75/75/50/50 priced in for the next four meetings, including today.

The vote was 10-1 with the Fed's George voting for 50 basis points. That's a big surprise from one of the Fed hawks.

The median dot in the dot plot is at 3.4%, which is up from 1.9%. That essentially validates market pricing, which is at 3.65%.

Federal Reserve Federal Reserve The Federal Reserve System, more commonly known as the Fed, represents the central banking system of the United States. Like other central banks globally, the Fed is responsible for monetary policy, in this case in the US.The Fed is one of the most watched and followed entities for forex traders, given its material impact on the US dollar. Founded initially in 1913, the Fed was created to perform a wide range of functions. This includes stabilizing and maintaining flexible monetary policy in the The Federal Reserve System, more commonly known as the Fed, represents the central banking system of the United States. Like other central banks globally, the Fed is responsible for monetary policy, in this case in the US.The Fed is one of the most watched and followed entities for forex traders, given its material impact on the US dollar. Founded initially in 1913, the Fed was created to perform a wide range of functions. This includes stabilizing and maintaining flexible monetary policy in the Read this Term Chairman Jerome Powell will host a press conference at the bottom of the hour at 2:30 pm ET.

Highlights:

• Repeats that "the Committee is highly attentive to inflation risks"
• Cites Ukraine war and covid in China adding pressure to inflation
• Says it "anticipates that ongoing increases in the target range will be appropriate"
• No changes to QE runoff
• "The Committee is strongly committed to returning inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term to its 2 percent objective"

The line about being "strongly committed" is new language but I wouldn't say it's particularly surprising.

One interesting bit is what has been removed. The line "the Committee expects inflation to return to its 2 percent objective and the labor market to remain strong" has been taken out and there's no reference to a strong labor market except to say that "job gains have been robust in recent months."