Treasury yields and the dollar index saw a resurgence, whereas stocks experienced a minor setback following the Federal Reserve's decision to keep interest rates unchanged, in line with expectations. The central bank also presented economic projections that leaned towards a more hawkish stance. Members of the Federal Open Market Committee (FOMC) maintained their forecast for the midpoint of the federal funds rate at 5.6% for this year, implying another 25-basis point increase, and revised their outlook for the next two years, indicating a more gradual easing of monetary policy. The projection for core PCE inflation in 2023 was adjusted slightly downward from 3.9% to 3.7%, still well above the 2% target. Yields and the dollar both advanced in response to this news. The 10-year yield currently stands at 4.355%, and the two-year yield at 5.135%, while the WSJ Dollar Index remains stable. The S&P 500 shifted into negative territory, while the DJIA pared back its earlier gains.
