Search
Close this search box.
Blog » News » Stock market banishes Fed rate hike worries

Stock market banishes Fed rate hike worries

An art deco rendition of a rising stock market

The stock market’s display today banished worries that the Federal Reserve would hit Wall St with a rate hike.

The governmental body released the FOMC statement and the following implementation note, a crucial guide for investors. They affirm that the economy is progressing towards the desired 2% inflation range.

Stock exchange weathers the Fed’s projections

The jobs report is inbound from the U.S. government, and leading light in the tech industry Apple’s stocks (APPL) reported a 4% surge. As we reported earlier this week, investors cagily monitored their portfolios as the Fed took time to release its views on the economy.

The Fed report stated, “The Board of Governors of the Federal Reserve System voted unanimously to maintain the interest rate paid on reserve balances at 5.4 percent, effective May 2, 2024.”

The jobs report to be published on Friday, May 3, will outline the state of play in the employment sector. We had reported that employers are providing more hospitable terms to workers, but there are few opportunities to meet the demand of Americans needing a change of workplace or a job in general.

The major detail placed in the filing note from the Fed stated their intention after a worrying patch for investors:

“Effective May 2, 2024, the Federal Open Market Committee directs the Desk to:

  • Undertake open market operations as necessary to maintain the federal funds rate in a target range of 5-1/4 to 5-1/2 percent.
  • Conduct standing overnight repurchase agreement operations with a minimum bid rate of 5.5 percent and with an aggregate operation limit of $500 billion.
  • Conduct standing overnight reverse repurchase agreement operations at an offering rate of 5.3 percent and with a per-counterparty limit of $160 billion per day.
  • Roll over at auction the amount of principal payments from the Federal Reserve’s holdings of Treasury securities maturing in May that exceeds a cap of $60 billion per month. Beginning on June 1, roll over at auction the amount of principal payments from the Federal Reserve’s holdings of Treasury securities maturing in each calendar month that exceeds a cap of $25 billion per month. Redeem Treasury coupon securities up to these monthly caps and Treasury bills to the extent that coupon principal payments are less than the monthly caps.
  • Reinvest into agency mortgage-backed securities (MBS) the amount of principal payments from the Federal Reserve’s holdings of agency debt and agency MBS received in May that exceeds a cap of $35 billion per month. Beginning on June 1, reinvest the amount of principal payments from the Federal Reserve’s holdings of agency debt and agency MBS received in each calendar month that exceeds a cap of $35 billion per month into Treasury securities to roughly match the maturity composition of Treasury securities outstanding.
  • Allow modest deviations from stated amounts for reinvestments, if needed for operational reasons.
  • Engage in dollar roll and coupon swap transactions as necessary to facilitate settlement of the Federal Reserve’s agency MBS transactions.”Image: Ideogram

About Due’s Editorial Process

We uphold a strict editorial policy that focuses on factual accuracy, relevance, and impartiality. Our content, created by leading finance and industry experts, is reviewed by a team of seasoned editors to ensure compliance with the highest standards in reporting and publishing.

TAGS
Financial News Writer and Editor
Brian-Damien Morgan, an accomplished journalist and features writer, boasts a rich career that has evolved across various media platforms. With extensive experience in the print sector of several UK newspapers, Brian transitioned seamlessly into the realm of digital broadcasting and specialized financial content creation. Brian now focuses on finance, technology, legal matters, and the wide spectrum of money-related topics.

About Due

Due makes it easier to retire on your terms. We give you a realistic view on exactly where you’re at financially so when you retire you know how much money you’ll get each month. Get started today.

Categories

Top Trending Posts

Due Fact-Checking Standards and Processes

To ensure we’re putting out the highest content standards, we sought out the help of certified financial experts and accredited individuals to verify our advice. We also rely on them for the most up to date information and data to make sure our in-depth research has the facts right, for today… Not yesterday. Our financial expert review board allows our readers to not only trust the information they are reading but to act on it as well. Most of our authors are CFP (Certified Financial Planners) or CRPC (Chartered Retirement Planning Counselor) certified and all have college degrees. Learn more about annuities, retirement advice and take the correct steps towards financial freedom and knowing exactly where you stand today. Learn everything about our top-notch financial expert reviews below… Learn More