Federal Reserve holds rates at 4.00% while December hike odds reach 80%
Expects the Federal Reserve to hold interest rates at 3.75% to 4.00% on Wednesday. Sees market odds of a 25 basis point rate hike in December rising to about 80%.
The Federal Open Market Committee is expected to maintain its benchmark interest rate at 3.75% to 4.00% on Wednesday, according to Kalkine and Vantage Markets. Investors are focusing on Chair Kevin Warsh's upcoming press conference for signals regarding future monetary policy.
Financial markets are pricing in an 80% probability of a 25 basis point rate increase in December. Meanwhile, the 10-year U.S. Treasury yield rose to approximately 5.0%, with the 30-year yield reaching around 5.42%, and the UK 10-year gilt yield hitting a 19-year high of about 5.43%.
What do these terms mean?
Federal Open Market Committee (FOMC): The committee within the U.S. Federal Reserve system responsible for setting national monetary policy and key benchmark interest rates.
Basis point: A standard unit of measure equal to one-hundredth of a percentage point, used to express changes in interest rates and financial yields.
Treasury yield: The annual return earned by an investor holding a government debt security issued by the U.S. Department of the Treasury.
Gilt: A high-grade government bond issued by the British government to fund public spending.
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