Dot Plot

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FOMC Dot Plot September 2024

FOMC dot plot September 2024:

FOMC dot plot March 2024:

FOMC: Less Rate Cuts

The recession will be more severe...

FOMC Dot Plot March 2024

 Dot plot 20-Mar-2024:

Dot plot 13-Dec-2023:

FOMC Meeting: more rate cuts

FOMC says more rate cuts:

Dec-2023:

Sep-2023:

 

FOMC Meeting

New dot plot:

Old dot plot:

 

FOMC Meeting

New dot plot:

Old dot plot:

FOMC Dot Plot

New dot plot:

Old dot plot:

 

FOMC Meeting: Huge Rate Hikes

The Federal Reserve is planning to hike rates until 3.5% by the end of this year.

Meanwhile GDP growth hits 0%.

 

FOMC meeting: Dot Plot

The new dot plot from the FOMC meeting minutes.

Old dot plot.

 

FOMC Meeting Dot Plot

FOMC meeting calendar.

The dot plot rose a bit on the September 2021 FOMC meeting.

Old dot plot:

What's interesting is that GDP is revised lower, unemployment higher and inflation higher. This is bullish gold.

FOMC Meeting: The Dot Plot Flattens

The Dot Plot has flattened out to 2023.

Old dot plot:

New dot plot:

Federal Reserve Maintains 0% interest rates through 2022

FOMC press conference.

The dot plot has been revised sharply lower.

Powell said: "We're not even thinking about thinking about raising rates".

He continued: "We want to see inflation." He also mentioned "yield curve control". This will keep bond yields low and will probably be very negative for the USD. This will be very good for precious metals and stocks.

Lower interest rates are necessary to be able to finance their rising budget deficits, which ballooned to $400 billion in May.

Powell Increases Repo Operations

The Federal Reserve has increased Repo Operations again due to the stock market turmoils. The maximum amount of repo has gone from $125 billion to $195 billion.

The balance sheet expansion is composed of the following.

Fed cuts rate by 50 basis points

Gold is soaring.

FOMC Meeting: Rates Steady

The Fed held rates steady. But what's very important is that repo is going to be extended until April 2020. This is supportive for gold. Bond yields were falling and starting to invert again. This has implications, because this gives a higher probability of a rate cut coming in March. By the way, he also said: "Many people benefit from low interest rates." Do you want more evidence that a rate cut is coming?

He also said that excess reserves shouldn't go below $1.5 trillion, he wanted ample reserves above $1.5 trillion. He said that he didn't anticipate that the reserves would need to be higher than $1.5 trillion. This means he will expand the balance sheet even more.

Federal Reserve cuts rates by 0.25%

Fed cuts rates to 1.75%, more to come later this year. Dot plot is also lowered.

 

FOMC minutes

Unemployment rate to rise.

Growth is slowing down.

 Interest rates will go lower.

 

FOMC Meeting: Gold Rises During Q&A Session With Janet Yellen

Today, the Fed raised interest rates to 0.75%-1% with longer term goal of 3%.

There are several issues with that. Why does Janet think that 3% interest rates will not crash the economy? Everyone knows that the 10 year bond yield will need to be higher than the fed funds rate, which means 10 year bond yields need to be higher than 3% in a few years.

When that happens, P/E ratios will go down as the following chart suggests. When earnings don't go up, this means that the price of stocks will need to go down. This will lead to a market crash.

We know that GDP only went up 0.9% yoy in the last quarter. So that says that growth is minimal and I don't expect bond yields will rise dramatically. So we will end up with flattening yield curves when the Fed keeps raising interest rates.Moreover, if the Fed knows GDP will only be at 2%, then why does the Fed want to raise interest rates to 3% in the first place? Doesn't make sense.

A recession is near. And we could even see an inverted yield curve soon. You do not want to see an inverted yield curve, because that means certain recession. The problem is, we already see that LIBOR is touching the 10 year bond yield.

 

So Janet, either you don't raise rates and let inflation spiral out of control. Or you raise interest rates to LIBOR rate and you'll trigger a recession.