US Fed Meeting Live: S&P 500, Dow Jones Edge Higher On Rate Cut Bets
The US stock market opened with positive momentum ahead of the Federal Reserve rate decision.
US Fed Meeting Live: Yields Unchanged
The yield on the benchmark 10-year US Treasuries was marginally higher at nearly 4% ahead of the Fed rate decision.
US Fed Meeting Live: How Does The Fed Implement Its Policy?
The Federal Open Market Committee is a 12-member policymaking body of the US Federal Reserve that meets several times a year to decide the stance of monetary policy. Its decisions directly influence interest rates and credit conditions, affecting spending, investment and overall economic activity across households, businesses and communities.
The FOMC sets policy to guide the economy toward its dual mandate of maximum employment and price stability. Here's a quick five-point explainer on how the rate-setting panel conducts and implements monetary policy.
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US Fed Meeting Live: What Ending Balance Sheet Runoff Means For Wall Street
Brad Bernstein, managing director at UBS Private Wealth Management, told Reuters that while investors are expecting a quarter percentage point rate cut from the Fed on Wednesday, "the most important thing the market is watching for" is what the central bank "will do with its balance sheet."
According to Bernstein, the US Fed may announce an end to runoff of securities on their balance sheets. To be clear, every month, billions of dollars mature in Treasuries and mortgage-backed securities. ''They've been allowing a lot of that to runoff, reducing their balance sheet. They may announce that's going to end before the end of the year.''
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US Fed Meeting Live: How Will A Rate Cut Impact D-Street?
According to Jigar Trivedi, Senior Research Analyst at Reliance Securities. markets currently “almost certain” (around 95-98% probability) expect the Fed to cut the federal funds rate by 25 basis points at the October meeting, bringing the target range to 3.75%-4.00%.
According to analysts, market expectations are very high for the cut and for multiple cuts this year; if the Fed disappoints (by cutting less or signalling fewer cuts) markets could react negatively (in equities, bonds, risk assets).
US Fed Meeting Live: What To Expect?—A Preview
The market has baked in a quarter point cut this week, bringing the federal fund rate to a range of 3.75%-4.00%. With the rate cut expected, Wall Street has turned its attention to the Fed's balance sheet management.
According to experts, a possible end this week to the US Fed's "quantitative tightening" policy may offer a boon to the US government. Most market watchers assumed quantitative tightening - letting bonds roll off the Fed's balance sheet - would continue through early 2026. However, Fed Chair Jerome Powell flagged a likely end to the whole QT process in the "coming months".
