The upcoming FOMC meeting will likely yield very little in the way of exciting news. Due to the recent tug of war between strong economic data and weak inflation, the Fed has chosen to remain patient thus far in 2019.
Currently, the CME Fed watch tool is calculating a 97% chance of no rate change with a 3% chance of a rate reduction. Market spectators anticipate this meeting to pass with little surprise.
Year to date, mixed economic data has prompted the Fed to leave rates unchanged. 33,000 new jobs were added in February, far and away the lowest we have seen in recent memory. On the other hand, nearly 200,000 jobs were added in March which is relatively high. With such varied economic signals, investors and the Fed alike take a step back to reassess the markets.
A similar tug of war has been observed between domestic expansion and inflation. Last week’s Q1 report showed a 3.2% increase in U.S. GDP, substantially stronger than expected. At the same time, inflation remains well below the Fed’s 2% target rate with many estimates around 1%.
These opposing forces will likely result in no action from the Fed with regard to interest rates. The Federal Open Market Committee will sit on their hands as long as the markets continue to grind higher, as there are always fewer critics in a rising market.
Although this meeting is not expected to shock the markets, investors should nevertheless be prepared for volatility surrounding news events. For up-to-date information on contract expirations, roll dates, news announcements & more, visit and bookmark the NinjaTrader Trade Desk Calendar.