The FOMC meeting minutes to be releasing today will reveal the dovish or hawkish stance of Fed officials. The minutes of the FOMC meeting held on November 6-7 will be released on November 26 at 2 pm ET. Investors worldwide are eagerly awaiting meeting minutes, which may provide valuable insights into ongoing discussions about possibly cutting interest rates again this year.
U.S. Treasury yields rose on Tuesday due to investors anticipating the Federal Reserve meeting minutes and upcoming economic data this week. The 10-year Treasury yield increased by nearly four basis points to 4.302%, while the 2-year Treasury yield reached 4.278% after rising by over two basis points.
The US Fed has cut rates twice after keeping them high for several months. The meeting minutes could reveal if a pause is ahead.
The rates were cut by 50 basis points and 25 basis points, respectively, in the last two FOMC meetings.
Before the elections, markets expected the US Federal Reserve to continue its aggressive rate-cutting campaign. However, Trump’s victory in the US presidential election on November 5 may have altered the situation, and it now appears unlikely that significant rate cuts would occur.
Some of Trump’s actions may be regarded as pro-market, yet his economic policies, particularly tax cuts and tariffs, may result in an increase in inflation. Also, Powell at an event last week said that there are no immediate signals to rapidly lower the benchmark interest rate due to the strength of the economy.
To decide on the next steps in monetary policy, the FOMC will meet next on December 17-18, when the Summary of Economic Projections along with the US Fed Dot Plot will also be revealed.
Markets reacted positively to Scott Bessent’s appointment as Treasury secretary by President-elect Donald Trump. On Monday, the Dow 30 index set yet another record and for the first time since September, the so-called yield curve reversed.
Global investors need to keep an eye on the dollar index and the 10-year Treasury bond yields to understand where the market goes from here. Markets will be closed on Thursday, November 28 due to Thanksgiving Day, and close early on Friday, November 29.