With expectations that the FOMC would drop "considerable time," ignore foreign market instability, and shrug off HY credit's demise (as they had previously said it was a bubble) [4], the members did not let anyone down...
- *FOMC SAYS IT CAN BE 'PATIENT' IN APPROACH TO RAISING RATES
- *FOMC DECLINES TO MENTION RECENT GLOBAL MARKET INSTABILITY
- *FOMC SAYS PATIENT APPROACH 'CONSISTENT WITH OCT. STATEMENT'
- *FISHER, PLOSSER, KOCHERLAKOTA DISSENT IN FOMC DECISION
For the 3rd FOMC meeting in a row, equity markets have surged (and decoupled from bonds); we will soon see if history repeats a third time.
Pre-FOMC: S&P Futs: 1988.00, 10Y 2010%, Gold $1195, WTI $57.50
What happened the last 2 times...
[5]
The Fed goes on to say...
- *FOMC SAYS JOB MARKET UNDERUTILIZATION `CONTINUES TO DIMINISH'
- *FOMC SAYS LABOR MARKET `IMPROVED FURTHER'
- *FOMC SEES INFLATION RISING TO TARGET AS LOW OIL IMPACT FADES
- *FED SEES JOBLESS RATE AT FULL EMPLOYMENT BY LATE-2015
- *FED SEES 2015 GDP GROWTH OF 2.6%-3%, UNCH VS SEPT. EST
- *FED SEES INFLATION AS LOW AS 1% IN 2015 VS 1.6% IN SEPT. EST.
- *FED SEES 2015 JOBLESS RATE 5.2%-5.3% VS 5.4%-5.6% IN SEPT. EST
- *FED MEDIAN FED FUNDS RATE 2.5% END-2016 VS 2.875% SEPT. EST.
* * *
And the redline from October: