What To Look For From The Fed’s November Interest Rate Decision

The Federal Reserve appears virtually certain to keep rates on hold at their November 1 interest rate announcement. That’s according to recent statements from Fed policymakers and the expectations of fixed income markets. However, the more interesting question is what the Fed signals about the prospect of another possible interest rate increase in the next few months and the potential path for rate cuts in 2024.

Rates Likely On Hold

The Fed is likely plans to hold rates at their current 5.25% to 5.5% range at its November 1 decision for a few reasons. The first is that the 10-year U.S. Treasury Bond yield has risen sharply over recent weeks. At the Fed’s last meeting the yield stood at 4.5% and it’s now closer to 4.9%. That’s a big jump in a closely watched fixed income benchmark and the Fed argues that that increase in longer term rates has done a lot of work in tightening monetary policy. In fact, Fed officials have described this move in rates as broadly equivalent to another interest rate hike.