Key for markets will be whether Fed Chair Jerome Powell’s commentary contains any hawkish surprises that could stoke concerns about a U.S. economic slowdown. Swap traders have trimmed the odds of a precipitous June hike from the Fed, suggesting around a one-in-three chance of a 75 basis-point increase next month. That would follow the 50-basis-point that is widely tipped to be implemented Wednesday.
The Federal Open Market Committee is also expected to announce plans to reduce the size of its bloated $8.9 trillion balance sheet. The panel will issue its statement at 2 p.m. in Washington. Powell will hold his first in-person press conference in two years 30 minutes later.
Jamie Dimon said the Fed should have moved quicker to raise rates as inflation hits the global economy. “We’re a little late,” the JPMorgan Chase & Co. chief executive officer told Bloomberg Television. “The sooner they move the better.”