May 2, 2018
It was back in January when the FOMC first upgraded inflation -- an assessment that tripped a big selloff in the stock market -- followed today by another upgrade, one that made for a late session 0.7 percent decline in the Dow. With Monday's core PCE inflation rate jumping 3 tenths to 1.9 percent and suddenly very near the 2 percent goal, the FOMC is now emphasizing the symmetry of its target, implying that an overshoot beyond 2 percent could be met by a policy reaction, that is an acceleration in rate hikes. Wording is only wording and the Fed did in fact keep rates unchanged at today's meeting, but a rate hike is the firm expectation for June's FOMC. Bonds were little changed on the day though the dollar index did rise 0.4 percent to 92.81.