Powell Turns Even More Hawkish

During his press conference today, Fed Chair Jerome Powell continued to read from the Volcker 2.0 script. His punchline appeared in his prepared remarks: “[W]e still have some ways to go, and incoming data since our last meeting suggest that the ultimate level of interest rates will be higher than previously expected.”

During the Q&A portion of his presser, Powell repeated “some ways to go” several times to describe the Fed’s path for tightening monetary policy. He also reiterated that the terminal federal funds rate is likely to be higher than suggested by September’s FOMC Summary of Economic Projections, which showed a median forecast of 4.6% next year.