Wed 13 Feb 2019 / North America
Questions over Fed dovishness
The Federal Open Market Committee's decision at the end of January to pause rate increases was long telegraphed and widely expected. But the highly dovish messaging in the Federal Reserve statement and press conference by Chair Jerome Powell surprised markets. The reasoning for the sharp shift in Fed rhetoric between December and January remains elusive. To reconcile an unchanged baseline economic outlook with its dovish messages, the Fed pointed to increased external downside risks.