Bond Market at Risk of Third Annual Loss Needs a Dot-Plot Rescue
- Fed policymakers set to unveil new forecasts for policy rate
- ‘Much maligned’ dot plot seen vital without forward-guidance
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Federal Reserve policymakers’ updated forecasts for their benchmark interest rate, due Wednesday, are looming as a key potential decider for a US Treasuries market at risk of a third straight year of losses.
While Chair Jerome Powell has sometimes downplayed the importance of so-called dot plot projections, they loom large given an aversion by him and his colleagues to offer much specific verbal guidance about the policy outlook. That’s even more the case for the Sept. 19-20 policy meeting, given near-universal expectations for the Fed to keep rates on hold this time.