The Battle Has Begun: Fed vs Investors
Fed is now gambling with the banks
The Federal Reserve raised the fed funds rate by 25 basis points to a range of 5%-5.25% Wednesday, delivering the eleventh hike in the tightening cycle and bringing the cost of borrowing to the highest since August 2007.
The U.S. banking system is sound and resilient, the Federal Open Market Committee said in a statement. Stricter credit conditions for households and businesses will likely have a negative impact on economic activity, employment and inflation, the FOMC said.
AAPL earnings report on 4 May after hours
The committee said it will closely monitor incoming data and consider the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation and economic and financial developments in determining the extent to which additional policy firming may be appropriate to return inflation to 2% over time.
The Fed removed the phrase "in determining the extent of future increases in the target" from its May policy statement.
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⚠️ Trading Tips: Expecting a volatile day after FOMC. Looking at calls above 409 and puts below 407 on Thursday. Pay attention to market reactions especially from the banking sector before taking action. All the best! 🙏
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Modify on 2023-05-04 10:51
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