Market Update – June 15, 2016
The Open Market Committee of the Federal Reserve Bank (the Fed) completes a 2-day interest rate policy-setting meeting this afternoon. This is their fourth meeting of 2016. They will release a statement detailing their policy stance @ 1pm CT.
Following the meeting, Fed Chairwoman, Janet Yellen, will hold a press conference (@ 1:30pm CT) to provide insight on the committee’s thought process and their near-term economic outlook.
The financial markets tend to be captivated equally by the action, or inaction, of the Fed as they are by the commentary offered by its leader.
The Fed raised interest rates by 0.25% in December of 2015 – the first lift since 2006. At that time, they expressed an interest in continuing on that “tightening” path.
However, they have stood pat in each of their first 3 meetings in 2016 – their apprehension a function of inconsistent data on job and wage growth as well as only modest influences of inflation.
In addition, many voting members of the Open Market Committee have cited certain swirling geopolitical winds – BREXIT and Chinese growth slowdowns – as causes for caution in their pursuit of a less accommodative monetary policy.
John Nagle has created some comprehensive slides to assist our team in interpreting the actions of the Fed, the inputs into their deliberations and the consequences of any actions: June 2016 Fed Preview
We thought it would be helpful to share these with our clients – kind of a like a Fed Road Map as the market’s meander through the summer.
Have a great day and I hope you find this information to be illuminating! dc
Important Disclosures:
The views expressed herein are those of Douglas Ciocca on June 15, 2016 and are subject to change at any time based on market or other conditions, as are statements of financial market trends, which are based on current market conditions. This information is provided as a service to clients and friends of Kavar Capital Partners, LLC solely for their own use and information. The information provided is for general informational purposes only and should not be considered an individualized recommendation of any particular security, strategy or investment product, and should not be construed as, investment, legal or tax advice. Past performance does not ensure future results. Kavar Capital Partners, LLC makes no warranties with regard to the information or results obtained by its use and disclaims any liability arising out of your use of, or reliance on, the information. The information is subject to change and, although based on information that Kavar Capital Partners, LLC considers reliable, it is not guaranteed as to accuracy or completeness. This information may become outdated and we are not obligated to update any information or opinions contained herein. Articles may not necessarily reflect the investment position or the strategies of our firm.