11 members have an impact on the foreign exchange market because they are key members of the FOMC.
FOMC Key Members – 2024
» Jerome H. Powell, Board of Governors, Chair
» John C. Williams, Bank of New York, Vice Chair
» Michael S. Barr, Board of Governors
» Michelle W. Bowman, Board of Governors
» Lisa D. Cook, Board of Governors
» Austan D. Goolsbee, Bank of Chicago
» Patrick Harker, Bank of Philadelphia
» Philip N. Jefferson, Board of Governors
» Neel Kashkari, Bank of Minneapolis
» Lorie K. Logan, Bank of Dallas
» Christopher J. Waller, Board of Governors
Parameters of the Hawkish FED Statement
A hawkish FED statement is an announcement made by the Federal Reserve (FED) indicating a more hawkish stance on monetary policy. This statement typically includes key parameters that indicate the Fed’s intentions regarding interest rates and monetary policy. Here are some parameters that are typically included in a hawkish FED statement:
1. Interest Rates: Hawkish statements often indicate an intention to raise interest rates. The Fed may mention a specific timeline or target for raising rates, such as “expecting to raise rates in the next few meetings.”
2. Monetary Policy Outlook: The FED may express a more positive view of the current state of the economy and its potential for growth. This could involve comments about higher inflation expectations, improved labour market conditions, or a stronger outlook for economic growth.
3. Accommodative Stance: Hawkish statements often signal a shift in the Fed’s accommodative stance. The Fed may indicate plans to reduce the size of its balance sheet or discuss strategies to tighten monetary policy.
4. Fiscal Policy: The FED may comment on the role of fiscal policy in driving economic growth or inflationary pressures. This could involve calls for fiscal discipline or suggesting that fiscal policy be adjusted to support monetary policy actions.
5. Risk Assessment: Hawkish statements often include an assessment of risks to financial stability and inflation. The Fed may discuss potential vulnerabilities or imbalances in the economy and highlight the need for proactive measures to address these risks.
6. Communication Strategy: The FED may announce changes to its communication strategy, such as providing more frequent updates on monetary policy decisions or adjusting communication tools to convey its message more effectively.
7. Policy Projections: Hawkish statements may include updated projections for interest rates, inflation, and economic growth. The Fed may offer its forecasts for future monetary policy decisions and provide insights into its decision-making process.
8. Statement of Intent: Hawkish statements often include a statement outlining the FED’s intent for future monetary policy actions. The Fed may express its commitment to maintaining a stable and resilient financial system and reiterate its commitment to achieving its monetary policy goals.
9. Timeline: Hawkish statements often include a timeline for implementing policy changes. The Fed may specify when it anticipates raising rates or implementing other adjustments to monetary policy.
10. Market Impact: Hawkish statements can sometimes have a significant impact on financial markets, including interest rates, exchange rates, and stock prices. The Fed may comment on the potential impact of its actions on financial markets and provide reassurance or guidance if needed.
US Fed meeting minutes: Here are 10 key highlights from the FOMC December meeting
According to minutes of the Federal Open Market Committee (FOMC) monetary policy meeting held on December 12-13, nearly all participants suggested a lower target range for the federal funds rate by the end of 2024, suggesting inflation was coming under control, with “upside risks” diminished.
As a result of new economic projections, most officials expect the policy rate to have to be lowered by three-quarters of a percentage point over the course of 2024, even though the central bank held its overnight interest rate steady at 5.25%-5.50% last month’s policy meeting.
-The Fed’s December meeting projected the benchmark policy rate to be at least three quarters of a percentage point lower by the end of 2024 than it is now.
-Inflation is under control, but officials are worried over the risk of “overly restrictive” monetary policy.
-During 2023, the minutes noted a decline in inflation, especially at the six-month level.
-The FOMC reaffirmed the need to maintain restrictive policy until inflation was clearly declining sustainably.
-Most participants projected that by the end of 2024, a lower federal funds rate would be appropriate.
-Rate cuts might not begin until the next Fed meeting, however, according to the minutes of the meeting.
-The policy rate was viewed as at or near its peak by participants.
-Commenting on potential additional firming with the word ‘Any’ generally conveyed their opinion that rates were likely at or near cycle peaks.
-In the coming period, some participants suggested FOMC may face a trade-off between dual mandate goals.
– Coming policy decisions would be “careful and data-dependent,” the minutes said.
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