The great expectations of the week are located on Wednesday and the announcement that the FED officials will make, after the FOMC meeting.
This is the monthly meeting that they will hold to evaluate the evolution of the economy and the direction of the decisions they will make for the United States.
The event is full of expectations, since since the Jackson Hole event, the chairman of the Federal Reserve made it clear that the economy has not yet recovered sufficiently from the crisis caused by the pandemic.
The key axes in the recovery and in the fundamental factors that the Fed relies on to make the decision are employment and inflation.
Employment has not yet achieved a full recovery. Nonfarm payrolls for August weren’t enough. The unemployment rate dropped to 5.2% in the last month.
As for inflation, it has exceeded the entity’s objective and it is generating concerns about an overheating of the economy. Although they have categorized it as “transitory”, it still persists and exerts pressure.
For these reasons, more and more Fed officials are endorsing a change in the course of monetary policy. It is likely that this meeting of the agency will provide greater clarity to the future of the economy. Specialists suggested that they could indicate a roadmap to follow, as other Central Banks have indicated.
The reduction of the stimulus program is undoubtedly closer and closer, but it generates expectations in the markets, that the rhythm of asset purchases and the types of loans is still maintained.