The FOMC gave us an as expected and still dovish statement. The only change in the economic outlook was they said the “labor market is beginning to improve” vs “labor market is stabilizing in March.” The inflation commentary was identical to March as they continue to see inflation “subdued for some time.” They will continue to keep rates “exceptionally low” for an “extended period.” As expected, they said nothing about selling their pile of MBS. Hoenig again dissented and said free money “was no longer warranted b/c it could lead to a build up of future imbalances and increase risks to longer run macroeconomic and financial stability, while limiting the Committee’s flexibility to begin raising rates modestly.” Net-net, a non event. One thing is for sure with this Fed, they will telegraph thru speeches their moves well in advance of a meeting b/c they are so afraid of spooking the market.
