So far it looks like Powell will be stuffing the Christmas stockings with coal.
The FOMC projections for rate hikes at year-end 2023 are a big contrast to market pricing. The market was looking for 4.28% before the Fed and they're forecasting 5.00-5.25% at the median with only two dots below 5%.
That's a higher-for-longer scenario that continues in 2024 and 2025 dots.
Now Powell could turn that all around by introducing some uncertainty around it and saying "perhaps we won't have to cut that much" if inflation falls faster than expected and growth stumbles.
But if he sticks to his guns, there is a lot of repricing that needs to happen and we could see much more selling in stocks and buying in the US dollar.
EURUSD 15 mins
