Fed Decision-Day Guide: Zero Hour for Moves on Rates, Dot Plot

Here’s what to look for when the Federal Open Market Committee releases its policy statement along with quarterly economic projections at 2 p.m. Thursday in Washington, and Federal Reserve Chair Janet Yellen holds a press conference at 2:30 p.m.

— The FOMC will weigh the impact on the U.S. outlook from slowing growth overseas and falling stock prices, as committee members determine whether to end almost seven years of near-zero interest rates. Economists are close to evenly divided on the outcome, with 59 of 113 surveyed by Bloomberg expecting the Fed to stand pat.

“It is a very finely balanced question,” said Jonathan Wright, a professor at Johns Hopkins University in Baltimore and a former economist at the central bank’s Division of Monetary Affairs. “It is close to a 50-50 call.”

While economic data have been “pretty compelling,” investors are skeptical the FOMC will want to move in the face of recent financial turbulence, said Stephen Stanley, chief economist at Amherst Pierpont Securities LLC in Stamford, Connecticut.

— The FOMC’s forecasts of the benchmark fed funds rate, revealed in dot-filled charts representing each official’s projections, may suggest a more gradual pace of tightening over the next few years than was suggested in June, said Michael Hanson, senior U.S. economist for Bank of America Corp. in New York.


Craig Erlam
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the BBC and The Telegraph, and he also appears regularly as a guest commentator on Bloomberg TV, CNBC, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.