Economists at Goldman Sachs on what to expect this week from the Federal Reserve's Federal Open Market Committee meeting
- We expect the statement following (the) FOMC meeting to remain relatively upbeat about US growth prospects
- However, the committee is very unlikely to raise the funds rate
- To keep markets on notice for a possible rate hike in December, we expect the statement to indicate that the committee is considering action "at its next meeting" ... although this is a close call
- The statement will likely again say that risks to the economic outlook are "roughly balanced"
- A statement along these lines should keep the committee on track to raise the funds rate at the December meeting
For the December meeting, Goldman Sachs see a 75% chance of an increase, roughly in line with market expectations:
- The remaining uncertainty relates to incoming economic data and financial conditions ... Conditional on decent data and stable markets, a December rate hike looks very likely
(bolding mine)
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The FOMC announcement is November 2, 1800GMT.
There will be no Summary of Economic Projections, nor a press conference by Yellen.