All eyes are on the Federal Reserve’s final policy meeting of 2023 this Wednesday, with markets expecting interest rates to remain at their 22-year high. Investors will dissect the Fed’s statement and Chair Jerome Powell’s press conference for hints about potential rate cuts in 2024.

Federal Reserve Meeting:

• Investors are glued to the Fed’s final policy meeting of the year, expecting interest rates to remain at a 22-year high.
• The Fed statement and Chair Powell’s press conference will be analyzed for clues about potential rate cuts in 2024.
• This event is preceded by key US inflation data, with forecasts predicting a slight 0.1% increase in November.

European Central Bank and Bank of England Decisions:

• Both central banks will announce their rate decisions on Thursday.
• The BoE is likely to maintain its 15-year high borrowing costs and emphasize the need for continued high rates.
• Any surprises in the BoE’s message could impact the market.
• Falling Eurozone inflation (now at 2.4%) suggests a further rate hike from the ECB is unlikely.
• Goldman Sachs predicts the ECB’s first rate cut in April, followed by 25 basis point cuts throughout the year.

Key Dates:

• Dec 13: US Federal Reserve policy meeting
• Dec 14: US November CPI data
• Dec 15: European Central Bank rate decision
• Dec 15: Bank of England rate decision