How dovish will FOMC be?

Also Interesting

• Quality access to international markets
• Sustainable investing: Think long term, act now
• Visie op roboadvies

Week Ahead

Next week the US Federal Reserve's interest rate-setting body (FOMC) will meet. The outcome of the meeting could set the markets in motion again before the end of the year. A rate hike is widely expected and should not surprise the markets. The outlook for the further development of monetary policy will be more exciting. Speeches by Jerome Powell, Chairman of the Central Bank, suggest that there will be a change here. Until now, the FOMC has communicated further gradual interest rate hikes. Over the past two years, this has meant quarterly interest rate hikes. After the interest rate hike next week, however, interest rates should have reached a level that will make a more differentiated approach necessary. Passages in Powell's speeches in which he pointed out both the risks of too fast and too slow interest rate hikes point in this direction for us. We therefore expect the FOMC to make further rate hikes dependent on incoming data and to communicate this new guidance to the markets next week.