Market Wire, North America

Policymakers on the Federal Reserve’s policy-setting committee are convinced rates will need to rise more than had been expected in September, but are preparing to moderate the pace of increases in coming months as they seek to assess the impact on the economy. According to a record of the group’s early November meeting published this afternoon, many participants felt there was considerable uncertainty around how high the federal funds rate would need to climb, but “various participants” warned that with inflation remaining high against a backdrop of continued supply and demand imbalances, the ultimate level was “somewhat higher than they...

A 1.8 percent month-over-month jump in energy prices – fuelled by a 4 percent recovery in the gasoline sub-index – added to increases in food and other categories in supporting the all-items index. With highly-volatile food and energy components excluded, core prices rose 6.3 percent year-over-year, up 0.3 percent over the prior month. This was well below the 0.5 percent increase markets had expected. As expected, shelter costs kept rising, increasing 0.8 percent in the month as rents and owners equivalent measures moved up. Overall non-energy services inflation turned more mixed, with transportation up 0.7 percent, while medical care costs...

The Federal Reserve’s rate-setting committee raised benchmark rates by 75 basis points and hinted at a more gradual tightening pace in the months ahead. At the conclusion of its two-day meeting, the Federal Open Market Committee unanimously voted to raise the target range for the federal funds rate to 3.75-to-4 percent, with no dissents in favour of a smaller move. In a largely-unchanged official statement setting out the decision, policymakers set the stage for a more nuanced approach to setting rates, saying “In determining the pace of future increases in the target range, the Committee will take into account the...