US Fed meeting: When, where to watch and what to expect?

The Federal Open Market Committee (FOMC) meeting is all set to begin tonight in Washington DC. The FOMC is the branch of the Federal Reserve System that decides the monetary policy of the United States by overlooking and managing the open market operations. It is basically the Fed’s primary body responsible for forming the monetary policy of the country.

The FOMC holds eight meetings every year. The current meeting, just ahead of the US presidential election, will be the 6th meeting of the year. During the last FOMC meeting in July 2024, the interest rates remained unchanged at 5.25%-5.50%.

Fed chief Jerome Powell will address the media after the two-day meeting comes to an end tomorrow, September 18. Experts believe that strong rate cuts are on the horizon and the market is buzzing in anticipation of the same. Everyone has just one question in mind—how much will the key rates change?

When and where to watch the US Fed meeting?

The two-day meeting happening on September 17 and 18 will begin tonight (IST) and the US Fed chair will hold the press conference at around 11:30 pm (IST) on September 18.

The media address after the meeting will be hosted by many YouTube channels including the official channel of the Fed.

The Fed will also be broadcasting the press conference on its official website.

What to expect from the US Fed meeting?

Notably, a rate cut in any form would be a first after March 2020 when the rates were slashed to almost zero as an attempt to support the US economy during Covid-19. The rates have been on the increase since 2022 as a result of inflation and geopolitical tensions.

The key lending rate has been at a two-decade high of between 5.25 and 5.50 percent for the last 14 months as the Fed has been waiting for the economic situation to get better. As the inflation rate has eased up and the US economy is on a growth trajectory, policymakers are finally considering a rate cut, a report by the Economic Times (ET) suggested.

According to the ET report, policymakers can now either slash the rates by 25 basis points to give a smooth change or a bold 50 points to help the labour market. However, the latter can end up risking an increase in inflation rates, the report added.

Will the US Fed meeting impact the Indian stock market?

Changes in the US monetary policy affect the Indian markets and even the global ones. This is due to the fact that a hike in rates can force foreign investors to cash out their investments in the Indian markets. Furthermore, rate hikes can also result in a weaker rupee in comparison to the dollar. Moreover, an increase in rates can cause volatility in the market along with higher interest rates on borrowing costs. Similarly, rate cuts result in a positive impact on the Indian markets.

Experts have suggested that an aggressive change in the rates by the US Fed Chair can impact the Indian markets heavily.