Fed review: FOMC signals Fed Funds above 5% in 2023
|- The US Federal Reserve hiked the Fed Funds Rate by 50bp as widely anticipated. The updated 'dots' signal policy rates above 5% in 2023.
- EUR/USD recovered near pre-meeting levels despite the hawkish rate projections, as Powell left the door open for less hikes if warranted by data.
- Resilient consumption, tight labour markets and still high underlying price pressures support the case for further hikes in Q1. We maintain our forecast of 50bp in February and 25bp in March unchanged.
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