FOMC Preview: The Fed's Final Hike, And What Comes Next...

... "when thinking about changes in Fed policy, it's important to separate what you think the Fed SHOULD do versus what you think the Fed WILL do. The difference between the two is important. I believe the Fed will increase the target range by 25 basis points; basically what's already baked into the market. However, I believe the Fed should pause at this point and access the direction of the economy, inflation, and the stability of the banking system." - Scott E.D. Skyrm

It's almost here: a little over a year after the Fed started its fastest tightening cycle since Volcker's go-go 80s, when on March 16, 2022 Powell hiked rates from 0.25% to 0.50%, the Fed is set to hike rates for one final time tomorrow when Powell and his FOMC career-academic henchmen, will raise rates to 5.25% for the final time (we have plotted the US debt/GDP overlay alongside the Fed Funds below just so readers get a sense of the proper context and the explosion in debt that is about to be unleashed after the next crash)...