Fed-related news tracking
2026
Mar19
The U.S. Federal Reserve has proposed revisions to the Global Systemically Important Bank (G-SIB) surcharge, potentially reducing capital requirements for the largest banks by 3.8%. According to Fed Vice Chair Michelle Bowman, the changes, part of the Basel III Endgame finalization, aim to streamline capital rules and encourage lending by creating a unified method for calculating risk-based capital. The revised proposal, expected by the end of March, is a response to industry opposition against earlier, stricter versions and is intended to help banks compete with non-bank lenders, particularly in the mortgage market.
The Federal Reserve's revised "Basel III Endgame" proposal will increase capital adequacy ratios for large banks by 1.4%, a significant reduction from earlier, more stringent drafts that faced intense industry backlash. The new rules, expected by the end of March, aim to encourage lending, streamline risk-based capital calculations, and adjust the G-SIB surcharge. For many large banks, capital requirements are now expected to remain flat or decrease slightly, potentially freeing up billions in capital. The proposal also includes considerations for revising the high-risk weighting currently applied to assets like Bitcoin.
Mar18
The Federal Reserve maintained its interest rate at 3.50%-3.75%, in line with expectations, but now projects only one rate cut for 2026. This decision is influenced by persistent inflation and economic uncertainty stemming from the conflict in Iran, which has caused a nearly 50% surge in Brent crude oil prices since late February. Consequently, the Fed has raised its 2026 PCE inflation forecast to 2.7% and its GDP growth forecast to 2.4%. Diverging views among officials were noted, with one projecting a rate hike next year, a first in over two years.
The U.S. Federal Reserve maintained its benchmark interest rate in the 3.50%-3.75% range for the second consecutive time, a move that was in line with market expectations. The decision is largely attributed to uncertainty and inflation concerns stemming from the Middle East conflict and rising energy prices. In response, markets have significantly reduced bets on rate cuts for 2026, with some analysts pushing forecasts for an initial cut from June to September and lowering the total expected easing for the year. Other central banks, like those in Hong Kong and the UAE, have followed suit by holding their rates steady.
Mar17
The CME "FedWatch" tool indicates a near-unanimous market expectation for the Federal Reserve to maintain current interest rates this week, with a probability of 98.9%. The chance of a rate cut is negligible for March and remains low for April, but the probability of a cumulative cut rises significantly to 78.1% by the June meeting. Experts cite ongoing Middle East tensions, inflation pressures, and a weakening job market as reasons for the Fed to remain on hold, a stance supported by hawkish commentary from Fed officials.
Mar12
Federal Reserve Vice Chair for Supervision Michelle Bowman announced that revised capital rules will be voted on in the coming weeks, resulting in a 'small amount' reduction in capital requirements for large banks. This move is seen as a significant policy win for Wall Street, reversing a previous 2023 proposal that suggested much stricter requirements. The revisions aim to better align capital with actual risks and eliminate overlapping standards. Morgan Stanley noted large banks hold substantial excess capital that could now be deployed for lending and share buybacks once the rules are finalized.
Mar09
On Monday, March 9, usage of the Federal Reserve's overnight reverse repurchase agreement (RRP) facility dropped to $332 million with 4 counterparties, down from $1.512 billion on the previous trading day.
Mar06
Market pricing for a June Federal Reserve rate cut has rebounded to approximately 50% following a disappointing jobs report that indicated a loss of jobs. This marks a sharp reversal from earlier in the week, when the probability had dropped to as low as 35% due to soaring oil prices stemming from conflict in the Middle East. Traders are now navigating conflicting signals: a potentially weakening labor market that argues for a cut, versus a persistent oil-driven inflation risk that argues for holding rates steady.
Mar04
Federal Reserve Governor Milan stated that it would be appropriate to continue cutting interest rates at the March meeting, likely by 25 basis points, and suggested a total of one percentage point in cuts for the year . He believes his outlook is unchanged by the conflict in Iran, arguing the labor market still requires support and that inflation is not a concern . This dovish stance contrasts sharply with other Fed officials and market expectations, which largely anticipate rates will be held steady due to geopolitical risks and persistent inflation .
Mar01
According to the CME "FedWatch" tool on March 2, the probability of the Fed cutting rates by 25 basis points in March is 6.4%, with a 93.6% chance of holding steady. This represents a significant decrease from early February when the probability of a March cut was 21.6% . The likelihood of a cut has steadily declined, hitting 7.8% on Feb 23 and 4.0% on Feb 24 . Looking ahead, the probability of a cumulative 25 bps cut by April is 22.6%, and it rises to 43.9% for the June meeting, making it the first meeting where a cut is seen as a significant possibility . This uncertainty has driven record open interest in U.S. Treasury futures at CME .
Feb27
Fed Overnight Reverse Repo (RRP) usage surged to $16.318 billion on Friday, Feb 27, a significant increase from the previous day's $3.796 billion . This follows a period of extremely low usage earlier in the week, with volumes hovering around $1 billion .
Feb18
The January Federal Reserve meeting minutes revealed significant internal division, with officials expressing renewed concerns about inflation. While rates were held at 3.5%-3.75%, several officials discussed the possibility of a rate hike if inflation remains persistently above the 2% target. Most members warned that the path to lower inflation could be slow and uneven, advocating for patience before considering rate cuts. The policy focus has shifted back towards inflation risks, with the vote to hold rates passing 10-2. Consequently, traders have pushed back expectations for the first rate cut, possibly to June.
The January Fed meeting minutes revealed that while almost all officials supported pausing rate actions, there was significant internal division on the future path of interest rates. Some members indicated that rate cuts could be appropriate later in the year if inflation declines as expected. However, a more dominant theme was caution, with several officials expressing concern about persistent inflation risks and warning that further rate hikes might be necessary if inflation remains high. The committee decided to hold the federal funds rate at 3.5%-3.75%, marking a "hawkish pause" after three consecutive cuts. The market has subsequently pushed back expectations for rate cuts.
The Federal Reserve released its latest meeting minutes, revealing a split among officials on the future path of interest rates. While some members support further rate cuts if inflation decreases, others prefer to maintain current rates for an extended period. The Fed kept the federal funds rate unchanged at 3.50-3.75% after its January meeting, emphasizing that policy is not predetermined and will adapt to incoming data. Prior to the release, markets were anticipating potential rate cuts starting in June, with expectations for two to three cuts in 2026.
Feb17
On Tuesday, February 17th, the usage of the U.S. Federal Reserve's overnight reverse repo (RRP) facility was $441 million, an increase from the previous day's $377 million. The number of counterparties was five. This level represents a significant decline from the $1.447 billion usage reported a week earlier on February 10th.
Feb14
According to CME "FedWatch" data as of February 14, the probability of the Federal Reserve maintaining interest rates at its March meeting is 90.8%, while the probability of a 25 basis point cut is only 9.2%. This marks a significant shift from a week prior, on February 8, when the probability of a March cut was 23.2%. The Fed had previously signaled a pause in its rate-cutting cycle at its January meeting, holding the benchmark rate at 3.50%-3.75% after three consecutive cuts. Officials have emphasized a data-dependent approach, with future moves contingent on changes in inflation and the labor market.
Feb13
Following a lower-than-expected January CPI report, market expectations for Federal Reserve rate cuts have solidified, with investors now betting on at least two cuts in 2026 and a rising probability of a third. The U.S. headline CPI rose 2.4% year-over-year, below the 2.5% forecast, while the core CPI met expectations at 2.5%. This has driven U.S. Treasury yields to their lowest levels of the year, as the market prices in a more dovish Fed stance. Analysts at firms like Jefferies and Goldman Sachs had already been forecasting two cuts, with some noting the potential for three if the economy slows as predicted.
Following a report of lower-than-expected US inflation in January, US interest rate futures have priced in a higher probability of a Federal Reserve rate cut in June, with the odds rising to 69% from 63% before the data release. Concurrently, the market's expectation for total rate cuts throughout 2026 increased from 58 to 61 basis points. This market reaction comes after the Fed held rates steady at its January meeting, emphasizing the need for patience and more data before easing policy.
Feb11
The Federal Reserve is re-evaluating regulatory warnings, specifically "matters requiring attention (MRAs)," issued to some banks as part of a broader overhaul of its oversight. Led by Vice Chair for Supervision Michelle Bowman, this initiative aims to shift the focus from procedural issues to "material financial risks" that could harm banks if unaddressed. The goal is to reduce the regulatory burden, increase transparency, and streamline the examination process, with clear-cut cases expected to be resolved by March and more complex ones by July. State regulators have expressed optimism about the changes, hoping for reduced friction and greater efficiency, particularly for community banks.
The U.S. Federal Reserve is signaling a relaxation of bank capital requirements, planning to drop certain non-public remedial warnings and continuing a broader easing of financial institution oversight under Vice Chair for Supervision Bowman. Specifically, examiners will re-evaluate outstanding warnings and rescind those not aligned with current priorities, focusing instead on immediate risks to banks' financial health. Furthermore, the Fed has decided to maintain current capital levels for large banks through the 2026 stress test cycle, delaying revisions to stress capital buffers until 2027 to allow for a review of its testing models.
