Analysts at JP Morgan Asset Management note that the Federal Reserve is likely to pause its rate hike cycle at this week’s Federal Open Market Committee (FOMC) meeting.

Key quotes

“We expect the Fed to leave the federal funds rate unchanged although both the post-meeting statement and the dot plot will likely emphasize that inaction this week should be considered “skipping a rate hike” rather than putting an end to monetary tightening.”

“Indeed, Fed communications could explicitly warn of a possible further rate hike in July.”

“On balance, however, cooling data on inflation and growth between now and that meeting should be enough to convince the Fed that no further tightening is warranted.”