The Complete Fed Decision Preview: All You Need To Know
by Tyler Durden
ZeroHedge.com
12/16/2015
At 2 p.m. EST, the only thing the financial world will care about and discuss will be the Fed’s [first rate hike in 9 years|epic disappointment]. So for those who still haven’t made up their mind about what the Fed’s [dovish|non-dovish] rate hike means, here is all you need to know.
First, a list of all the key announcements and public statements that everyone will be parsing at a feverish pace, courtesy of Citi:
The schedule
14:00 EST/19:00 GMT: Statement and economic projections
To be released here: http://www.federalreserve.gov/monetarypolicy/fomccalendars.htm
Statement will detail if anyone dissented to the decision. If so, most likely Evans.
Expected alongside the statement: Implementation/operation details note released by NY Fed regarding lift-off.
NY Fed website press releases: https://www.newyorkfed.org/press/index.html
Adjust the target band: increase overnight reverse repo rate from 0.05% to 0.25bps
Of primary interest will be the size of the overnight reverse repo facility that the Fed will put in place to pull short rates higher. Citi US
Rates Strategy doesn’t think it will be unlimited, but a size large enough that will keep short rates from falling below the 25bp floor – and the size could be as high as USD1tn.
The o/n reverse repo program is meant to be temporary in nature and will be phased out when the need to pull fed funds higher is not needed. It will be interesting to see how long the RRP program will be needed – perhaps till we get closer to 1% on IOER.
Doesn’t expect changes to size of term reverse repo operations or any further guidance on ending re-investments at this stage
14:30 EST/19:00 GMT: Yellen Press conference
The Rest…HERE
