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Fed 2018 Dots in Focus for Yellen Swan Song: Decision Day Guide

If all goes as expected, she will use her final scheduled press conference before stepping down at the helm of the U.S. central bank to explain why officials raised rates a third time this year.

“The rationale for raising the dots would be a presumed increase in demand in an economy that already is growing well above potential with a tight labor market,” said Roberto Perli, partner at Cornerstone Macro LLC in Washington.

The September path of the dot plot suggests an inverted curve by late 2018, which in the past has been a “bearish signal,” warned St. Louis Fed President James Bullard.

Beyond the dots, the most important signal may be the FOMC’s core Inflation forecasts because it will suggest how convinced the committee is that prices are quickly returning to the goal, said Chris Rupkey, chief financial economist with MUFG Union Bank in New York.

It’s likely to be viewed by the Fed as “further evidence pointing to the end of the inflation soft patch,” Bloomberg Intelligence economists Carl Riccadonna and Yelena Shulyatyeva said in a report.

READ MORE (Bloomberg)

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Fed 2018 Dots in Focus for Yellen Swan Song: Decision Day Guide


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