The takeaway ….
The Federal Open Market Committee is expected to announce no change in the target range for the federal funds overnight rate. The current target range is 5.25-5.50%. The federal funds rate is the rate banks charge for lending their reserves to each other overnight. The current effective (weighted) rate is approximately 5.33%.
Commentators believe that higher long term bond rates may be relieving the Board from raising rates at least during this meeting. Higher long term bond rates may be indicia that the markets expect higher growth accompanied by higher inflation into the near future.
Alton Drew
1 November 2023
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Rates of interest ….
30-Day Federal Funds Futures: 94.605
Effective Federal Funds Rate: 5.33%
Discount Window Rate: 5.50%
Interest on Reserve Balances: 5.40%
Federal Funds Rate target range: 5.25-5.50%
EUR/USD=1.05277
AUD/USD=0.63548
GBP/USD=1.21067
USD/JPY=151.36152
Sources: Board of Governors-Federal Reserve System. CME Group. x-rates.com.
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