Fed Traders Seek an Answer to the 75-Basis-Point Question
- The Fed hasn’t hiked by that much in one meeting since 1994
- All eyes will be on how Powell performs at press conference
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A lot is riding on how Federal Reserve Chairman Jerome Powell parries a question he’ll surely be asked after Wednesday’s monetary policy decision: is a 75-basis-point rate hike in the cards at some stage?
The U.S. central bank is expected to raise rates by 50 basis points at this meeting, something it hasn’t done since May 2000. And half-point moves are fully priced in by swaps traders for each of the following three meetings -- June, July and September -- the most aggressive trajectory in three decades. But there might still be room for even more hawkishness, depending on how Powell navigates his upcoming press conference.