Live updates on November Fed rate decision

The Fed statement’s reference to tighter financial conditions could be a key takeaway from Wednesday’s report. Long-term interest rates have risen in recent months even though the Fed’s hikes have been on pause, which may make the Fed more comfortable holding the benchmark rate at its current level.

“The statement’s emphasis on financial conditions weighing on the economy is potentially a signal that the Fed has minimal appetite to raise rates further,” said Seema Shah, chief global strategist at Principal Asset Management. “But with the economy still so hot and inflation deceleration potentially hitting a road bump, an overly dovish approach from Powell may risk a resurgence in inflation pressures. Powell has a careful balancing act ahead of him – not just today but for the coming months.”

— Jesse Pound

Policymakers made several tweaks to their November statement.

Updates to the text include acknowledging the “strong” pace of economic expansion in the third quarter. The central bank also noted that job gains have “moderated since earlier in the year.”

Read more about the November updates to the Fed’s statement.

–Darla Mercado, Alex Harring

In its decision to keep interest rates steady once more, the Federal Reserve upgraded its stance on the economy.

The Fed’s post-meeting statement said that “economic activity expanded at a strong pace in the third quarter.” Back in September, policymakers said the economy had expanded at a “solid pace.”

This latest decision from the central bank arrives on the heels of a report showing that U.S. gross domestic product expanded at a 4.9% annualized rate, surpassing expectations.

Read more about the Fed’s decision here.

–Darla Mercado, Jeff Cox

The central bank left interest rates unchanged for a second consecutive time at the conclusion of its November meeting. That keeps the fed funds’ target rate at a range of 5.25% to 5.5%.

Stocks remained positive, with the S&P 500 up 0.4%, the Nasdaq Composite up 0.7% and the Dow up 0.3%.

Treasury yields slipped, with the 10-year yield sliding to 4.795%, off about 8 basis points.

–Darla Mercado

Stocks had modest gains – but were off their session highs – in the minutes leading up to the Federal Reserve’s 2 p.m. ET decision.

Though policymakers are expected to skip a rate hike Wednesday, investors shouldn’t bet on the Federal Reserve ending its policy-tightening campaign, said Jeffrey Lacker, former president of the Richmond Fed.

“There’s nothing in it for him [Chair Jerome Powell] to take interest rate hikes off the table and signal a definitive pause for a long time,” he said on CNBC’s “Squawk on the Street.” “He’s going to keep them on the table. They’re still far from getting done bringing inflation under control.”

Lacker noted that wage rate gains don’t seem to be coming down in a material fashion and that recession risks have receded in the past six to 12 months.

“It looks like 3.5% or 4% is right around where inflation is now, so we have a ways to go is the point,” he said.

–Darla Mercado

Central bank officials are expected to hold steady on policy Wednesday, but the main event will be Federal Reserve Chair Jerome Powell’s upcoming press conference.

Fed funds futures pricing suggests a roughly 98% likelihood that the benchmark rate will remain within the central bank’s target range of 5.25% to 5.5%, according to the CME FedWatch Tool.

The Fed’s rate decision arrives nearly a week after a report showed that the U.S. gross domestic product grew at a 4.9% annual pace – surpassing expectations. At the same time, Treasury yields have remained high and the rate on the 10-year note popped over 5% in October.

These developments make Powell’s upcoming press conference at 2:30 p.m. ET even more important. Investors will be looking for additional context around the Fed’s latest decision, as well as insight into the path forward for rate policy.

Read more about Powell’s announcement here.

–Darla Mercado, Jeff Cox