Fed Rate Pulse

Key updates on Fed's SOMA portfolio:

• Unrealized losses dropped to $844.2B from $1.06T in 2024.
• Accounting artifact only—no impact on monetary...

Wall Street strategists expect the Fed to take a slow and careful approach to winding down its T-bill purchase program, after abruptly halting QT end-2025 and pivoting to add reserves via short-term Treasuries.

Geopolitical shock locks in no Fed move: Investors price >97% chance rates stay at 3.5%-3.75% for April 28 meeting.

• Collapsed Iran talks spike oil...

• Slow unwind ahead: Fed stopped QT end-2025, shifted to $40B/month T-Bill buys since Dec to add reserves.
• Front-loaded for taxes: Powell cited...

Traders price 97% odds of Fed holding rates steady at 3.5%-3.75% for April 28 FOMC, up after 3.3% CPI rise driven by Iran Strait oil disruptions....

March FOMC minutes spotlight persistent inflation risks: "inflation could prove to be more persistent than the staff anticipated"—linked to inflation...

Hawkish pivot in March FOMC minutes: "Some participants" see rate hikes appropriate if inflation stays high—first mention this cycle. Vast majority...

• DXY plunged 1.3% this week—biggest loss since January—despite 10-year yields rising to 4.321%.
• Core CPI tame at 0.2% m/m and 2.6% y/y (below...

March CPI Highlights

• 🔥 Headline Inflation Jumps: U.S. headline CPI rose to 3.3% y/y in March from 2.4% in February and +0.9% m/m from +0.3%,...

• Core CPI slowdown at +0.2% MoM (below +0.3% exp) eases broad inflation fears, sparking dollar selling (USD/JPY to 158.94) and receding rate hike...

Key hawkish signals from March FOMC minutes: Some officials open to rate increases due to stubborn inflation amplified by Iran war.

Inflation surge...

FOMC Minutes Release

• 🔥 11-1 Vote to Hold Rates: FOMC voted 11-1 to hold interest rates at 3.5%-3.75% in March meeting, debating rate cuts if...

Key split on Iran war oil spike's Fed impact:

• Analysts fear unanchored expectations fueling spirals, echoing 1970s, delaying 2% target.
• Markets...

FOMC divide in March minutes: 11-1 hold at 3.5%-3.75%, open to cuts if inflation cools or hikes if not.

• Sticky PCE met Feb expectations (0.4% MoM,...

Key FOMC divide from March minutes:

• Rates held at 3.50%-3.75%; inflation above 2% target with uneven progress
• Some officials eye maintaining or...

March FOMC Minutes Highlights

• 🔥 Officials Expect Rate Cut This Year: Federal Reserve officials still expect to deliver an interest rate cut...

Fed baseline holds: Officials still project one rate cut this year, unchanged from December, if inflation eases.

• War uncertainty delays timing: Some...

Growing hawkishness in March minutes: Larger group of policymakers open to rate hikes if inflation stays above 2% target, driven by U.S.-Israeli war...

Middle East ceasefire calmed oil fears, boosting odds of a Fed rate cut by December to 25% (up from 14%) on lower energy costs.

March minutes confirm...

Key investor focuses ahead of today's March FOMC minutes release (18:00 GMT):

• Inflation worries: Views on persistent pressures from oil surges and...