Fed Watch: June 14-15 FOMC Meeting _

> The Federal Reserve Open Markets Committee (FOMC) minutes, due for the meeting on June 14-15, will provide clues to how agressive policyholders plan to be, on the back of the 8.6% rise in consumer price index in May, the highest level reached in more than four decades.

The Federal Reserve will likely deliver its second consecutive 50bps interest rate hike and continue to roll off assets from its nearly $9 trillion balance sheet. Markets are currently pricing in a 95% chance of another 50bps rate hike this month. If the FOMC pulls this trigger on another 50bps raise, its federal funds rate target rate will be between 1.25% and 1.50%.

The Fed has been walking a tightrope in recent months, attempting to bring down inflation levels without plunging the U.S. economy into a recession, whilst markets have concerns that the Fed will not achieve a 'soft landing' for the economy.

So far, the Federal Reserve tightening measures have not stalled US economic growth and avoided a sharp economic downturn, and there are no signs an economic recession is imminent at this point.

On June 3, the U.S. Labor Department reported the economy added 390,000 jobs in May, exceeding economist expectations of 325,000 jobs. The U.S. unemployment rate remained stable at 3.6%, while the labor participation rate ticked higher by 10 basis points to 62.3%. Average U.S. wages were up 5.2% from a year ago and 0.3% month over month in April.

Going forward, inflationary pressures are expected to persist and interest rates continue to rise.