WSJ Timiraos on the Fed decision
WSJ's Timiraos, thought to the a sounding board for the Fed's Powell, is saying:
- The Fed faces one of their toughest calls in years
- do they continue to raise rates to fight stubbornly high inflation or take a timeout due to the intense banking crisis
- decision on whether to hike by 25 basis points is likely to hinge in part on how markets digest the UBS/Credit Suisse merger, and other steps to calm fears of contagion in the banking system
- Until now the Fed has not confronted in abrupt and fluid crisis on the eve of a policy meeting
Is the Fed chair stuck in a box due to the inflation fighting concerns and forced to tighten, or will they think outside the box due to concerns about financial institutions and keep rates unchanged?
Futures markets at midday implied a roughly 75% of a quarter-point increase.
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