There was one notable question at the post-FOMC press conference. Let's tune in.

CME Fedwatch data, various dates, chart by Mish

Press Conference Q&A

At the post FOMC press conference, Michael McKee of Bloomberg asked Fed Chair Jerome Powell "Are you ruling out the rate cuts that the market has prices in?"

Powell responded "We on the committee have a view that inflation is going to come down not so quickly. It will take some time. And in that world, if that forecast is broadly right, it would not be appropriate to cut rates and we won't cut rates. Markets from time to time have been pricing in quite rapid reductions in inflation. We factor that in but that's not our forecast."

Video Length: 01:47:10

That dialog starts roughly at the 1:30:26 mark.

Who's Wrong?

The lead chart shows the bond market ignored those comments, going so far as to accelerate the pace of rate cuts. 

The pre-FOMC snapshot was about 30 minutes before the meeting and the post-FOMC data was taken many hours after the meeting.

A quick check now at 12:42 AM on May 4 has the weighted average for the March 2024 meeting at 3.79 percent.

For more on the FOMC Meeting, please see Fed Says Banking System is Sound and Resilient, Hikes Interest Rate a Quarter Point

The Fed Forecasts a Recession, Powell Himself Doesn't

On April 13, I noted Fed Minutes Now Predict a Recession This Year Along With Higher Unemployment

The subject of recession came up a couple of time at the press conference. Powell's personal opinion is there will not be a recession. 

Good luck with that.

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