Name: FOMC Meeting RECAP 5/4/22 | Finally some good news!
Uploaded: 2022-05-05T09:08:37+00:00
Duration: 4 min 33 s
Description: #FOMC #FederalReserve #RateHike Federal Reserve Explained in 10 Minutes: https://www.youtube.com/watch?v=nCQamaDZfJA Today the Federal Open Market Committee had their May 4th FOMC meeting. In the begi

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Fed Federal Reserve FOMC Meeting Rate Hikes Investing quantitative easing quantitative tightening Stock Market Stock Market for beginners Monetary Policy May 4th

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Federal Reserve Explained in 10 Minutes: https://www.youtube.com/watch?v=nCQamaDZfJA

Today the Federal Open Market Committee had their May 4th FOMC meeting. In the beginning of the meeting the Fed informed us that they will be raising the federal fund rate by 50 basis points as expected.

Early on in the meeting Jerome Powell discussed the Feds plan to significantly decrease the size of their balance sheet. On the Federal Reserve website they posted a plan for the balance sheet runoff stating "Beginning on June 1, For Treasury securities, the cap will initially be set at $30 billion per month and after three months will increase to $60 billion per month and For agency debt and agency mortgage-backed securities, the cap will initially be set at $17.5 billion per month and after three months will increase to $35 billion per month."
Feds plan for their balance sheet:
https://www.federalreserve.gov/newsevents/pressreleases/monetary20220504b.htm

The Federal Reserve is looking to transition from quantitative easing to quantitative tightening.

The Fed chair Jerome Powell believes that the Federal Reserve will be successful with having a soft landing. He sates that housing spending and business investments are fairly strong, the labor market is strong, and that the economy is in a position where it can handle the tighter monetary policy."

Jerome Powell is confident that the Federal Reserve will use their tools to restore price stability without causing a recession.

Jerome Powells made the hawkish statement "The Federal Reserve is looking to increase rates expeditiously" which left pretty much every stock ripping in that moment.

Overall this is the meeting that the market needed. The Fed came out and pretty much said everything that the market was expecting which is a great thing. The market appeared to love what was said in the meeting.

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