BlackRock Expectations for Fed Meeting: What to Expect?

BlackRock, the world’s largest asset management company, has released its expectations for the Federal Reserve (Fed) just hours before the meeting. The institution that excited cryptocurrency investors with its application for a Spot Bitcoin ETF is wondering what the Fed will do at this stage. What time is the Fed meeting and what will be announced?

BlackRock Fed Expectations

Experts from the US investment firm BlackRock made important evaluations related to the agenda of the week. Laura Cooper, Senior Macro Investment Strategy of BlackRock’s iShares EMEA, expects Federal Reserve (Fed) Chairman Jerome Powell to pause interest rate hikes. According to Cooper, Powell will continue to emphasize the role of economic data on future decisions. In other words, the Fed chairman may want to keep the door open for interest rate hikes.

According to Cooper, interest rates will likely remain in a restrictive zone until mid-2024 before the central bank readjusts interest rates towards “neutral.”

What Time is the Fed Meeting?

Another senior BlackRock official, Marilyn Watson, says that interest rates will remain unchanged this year. According to her, the Fed will move slowly and needs to see a deterioration in the economy, lower gross domestic product, and a lower unemployment rate in order to accelerate. Watson clearly states that interest rates will remain at their current levels throughout 2023.

Since March 2022, the Federal Reserve has raised interest rates 11 times to combat rising US inflation. The latest interest rate decision will be announced on Wednesday at 21:00 GMT.

The Fed will also release a graph called the “dot plot” on Wednesday evening, which includes officials’ interest rate projections. This graph is important in terms of future expectations as it reflects members’ three-year interest rate forecasts.

Approximately 40% of economists participating in the Financial Times survey predict that the bank will raise interest rates by 25 basis points at this week’s meeting.

Lynam, Head of Macro Credit Research at BlackRock’s Portfolio Management Group, says that obtaining credit at current rates may be appropriate as he does not expect interest rate cuts in the short and medium term.

“I think companies are approaching the idea that borrowing costs may not be better at the end of this year or the beginning of 2024.”