1. INTEREST RATE DECISION/ECONOMIC PROJECTIONS • At its September 20th meeting, FOMC officials left their benchmark interest rate unchanged, just their second pause since they began tightening rates in March 2022. • Markets and onlookers were well-prepared for the decision, with futures markets pricing in a no-hike scenario in September for the past several weeks. Like their recent pause in June, officials leaned their decision on recent data, expressing a need to “proceed carefully” in determining the direction and magnitude of the policy decisions moving forward. • Key officials have signaled their expectation that at least one more rate increase will occur before the year’s end. In its accompanying Summary of Economic Projections, the Fed’s dot-plot forecasts an additional 25 bps hike in 2023 before two cuts in 2024. Notably, this month’s projections indicate two fewer rate cuts in 2024 compared to their last projections released in June. • The Fed’s projections also revised up expectations for 2023 end-of-year economic growth, forecasting GDP to rise 2.1% this year. 2. CONSUMER CONFIDENCE • US consumer confidence fell to a four-month low in September, eroded by resurging concerns around inflation and a potential US recession, according to the latest data from the Conference Board. • Consumers continue to shift towards a more pessimistic outlook despite relatively upbeat views about the present day. One of the components of the Conference Board’s index—the present situations index— which assesses consumers’ opinions on current business and labor market conditions, rose slightly during the month. Meanwhile, the expectations index, based on consumers’ short-term forward outlook on those same conditions, has fallen for back-to-back months. • After recession fears reduced throughout the summer, they are evidently on the rise again. According to the report, consumer fears of an “impending recession” ticked up slightly during the month.

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