January FOMC meeting seen as a "steady" affair…limited policy variables

JH Kim

Summary

It said the January meeting of the U.S. Federal Open Market Committee (FOMC) is likely to pass without major volatility.
BofA Securities said it is unlikely the FOMC will deliver a decision or signal that would surprise markets, and that expectations favor holding the policy rate.
It added that the meeting is more likely to reaffirm the existing stance than to provide new clues on the policy direction.

Forecast Trend Report by Period

According to Walter Bloomberg, a breaking news account, on the 23rd (local time), a forecast said next week’s January meeting of the U.S. Federal Open Market Committee (FOMC) is likely to pass without major volatility.

BofA Securities said it is "unlikely that this FOMC meeting will deliver a decision or signal that would surprise markets." The prevailing view is that the policy rate will be left unchanged at current levels.

BofA also said Chair Jerome Powell’s press conference could focus more on political and external-environment issues than on shifts in monetary policy. Still, market participants are expected to watch for Powell’s assessment of the December decline in the unemployment rate and how resilient economic activity ties into judgments about the neutral rate.

The report added that "this meeting is more likely to reaffirm the existing stance than to provide fresh clues about the policy direction."