Fed officials continue to pursue the most hawkish line, saying that they do not even think to reduce the rate next year… the same Ballard yesterday said that the Fed is not tough enough and that they need to continue to aggressively raise in 23em.
But here’s the thing… the market doesn’t believe all this anymore and doesn’t react to these statements at all, although just recently it was falling down on something like this. Moreover, the market is beginning to price in 2 rate cuts by the end of 2023 (see the screenshot). In other words, the collective mind of market participants believes that the Fed members are blatantly deceiving, and the policy will change very soon.
