In the Aftermath of Last Week’s Rate Hike, Fed Officials Will Speak This Week

In A Nutshell: A light economic calendar this week means the focus will be on digesting last week’s Fed meeting, and on any geopolitical developments. Last Week’s Highlights

Last week was dominated by Wednesday’s hawkish Fed meeting, where the FOMC took us on the first step of a new hiking cycle. The committee formally projected one more hike this year, but Chair Kevin Warsh’s remarks indicate that firmer inflation data could easily put us on a path to more. Taking a step back, expectations for the Fed have taken a 180 this year, from expecting one cut at the start of the year to now expecting two hikes or more. The reason: the latest economic data make the three cuts from the end of 2025 look like a mistake. There were also some dovish details from the Fed meeting. The median FOMC participant projected core PCE inflation at 3.4% at the end of 2026.

But that should be quite easy to beat, given the upcoming revisions to PCE methodology. These revisions are an attempt by the Bureau of Economic Analysis to better measure inflation. Fed officials have been long aware they are coming.

Setting such an easy target leaves room for the committee to pull back on expected hikes should the economics winds shift. Upcoming Attractions

There’s little on the economics calendar that should have a significant impact on markets this week. But the UN General Assembly meetings are happening in New York, with lots of side meetings that could alter the geopolitical landscape. It’s also worth noting that Fed officials are now out of their blackout period, so the calendar is packed with speaking engagements. New York Fed President John Williams, an FOMC member who always has a vote and is highly influential, has three planned events: Tuesday, Thursday, and Friday.

Cleveland Fed President Beth Hammack, a notable hawk in favor of higher rates, is also speaking on Thursday. Fed watchers will be parsing their remarks for further evidence on how many more hikes may be coming–and how quickly.

While not likely to directly impact rates, Friday’s durable goods report will give us more insight into how hot GDP is running in Q3. Trackers and forecasters now estimate Q3 GDP growth around 3.5 to 5%, significantly better than the 2-ish% we’ve been at for the past couple of years. Redfin and Rocket’s Most Recent Housing Reports

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