The US Federal Reserve's Summary of Projections showed on Wednesday that four policymakers see a lift-off in the fed funds rate from zero in 2022, compared to only one policymaker in December's publication. Additionally, the number of policymakers who see a lift-off in the fed funds rate from zero in 2023 rose to seven from five in December.
Market reaction
With the initial market reaction, the USD came under strong selling pressure and the US Dollar Index, which tested 92.00 earlier in the day, was last seen losing 0.25% on the day at 91.63.
Follow our live coverage of the FOMC decision and the market reaction.
Additional takeaways as summarized by Reuters
"Fed policymakers continue to see no rate hikes through 2023: median forecast in the summary of economic projections."
"Fed's median view of fed funds rate at end-2023 0.1% (prev 0.1%)."
"Fed's median view of fed funds rate in longer run 2.5% (prev 2.5%)."
"Fed sees US GDP growing 6.5% in 2021 (prev 4.2%), 3.3% in 2022, 2.2% in 2023; median long-run forecast at 1.8% (prev 1.8%)."
"Fed sees year-end US jobless rate at 4.5% in 2021, 3.9% in 2022, 3.5% in 2023; median long-run forecast at 4.0% (prev 4.1%)."
"Fed sees Personal Consumption Expenditures (PCE) inflation at 2.4% in 2021, 2.0% in 2022, 2.1% in 2023."
"Majority of Fed policymakers see risks to inflation forecasts weighted to the upside, vs majority seeing downside risk in December."
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