According to Fed regulations, the Fed will enter a “silence period” within 10 days before the Federal Open Market Committee (FOMC) meeting, and Fed officials are prohibited from continuing to speak out on monetary policy views. Before the “silence period”, Fed Chairman Powell, European Central Bank President Christine Lagarde, Bank of England Governor Bailey and other policymakers will participate in the IMF’s global economy at 1:00 a.m. Beijing time on April 22 (Friday). Group discussions and presentations.

This will be Fed Chairman Jerome Powell’s last speech before the May monetary policy meeting, and the market believes that Powell may continue to strengthen expectations for a 50 basis point rate hike. Following the “boots landing” of the Fed’s interest rate hike in March, Powell has clearly indicated that interest rates may be raised by 50 basis points in the future, and the reduction of the balance sheet may start in May.

Federal Reserve officials have recently taken turns to “release eagles”

St. Louis Fed President Bullard said on Monday that U.S. inflation was “just too high” and that the Fed needed to act quickly by raising interest rates by 50 basis points multiple times to around 3.5% by the end of the year, and not ruling out one Option to hike rates by 75 basis points.

Bullard has been the FOMC’s strongest supporter of austerity over the past year.

Chicago Fed President Evans said on Tuesday that he is satisfied with the path of interest rate hikes this year, including two 50 basis point hikes, and expects rates to rise to 2.25%-2.5% by the end of the year. The Fed is likely to raise interest rates above “neutral” levels next year, given the outlook for inflation. But he expressed caution about adjusting the balance sheet, arguing that it would not be a positive policy tool.

It is worth noting that Evans has always belonged to the dove camp, and he is a representative of the lower half of the dot plot. (Evans does not have a vote on the FOMC this year)

Atlanta Fed President Bostic said Tuesday that controlling inflation is important, but monetary policymakers should not act too aggressively so as not to jeopardize economic growth. The IMF’s downgrade of global growth forecasts is a signal that the Fed needs to be cautious and the reason for not rushing to move rates above neutral.

In addition, the Fed’s “third-in-command” Williams and Fed Governor Waller last week both expressed support for raising interest rates by 50 basis points at the next meeting. However, the Fed’s future “second-in-command” Brainard last week shied away from judging the magnitude of interest rate hikes, saying only that the Fed is committed to keeping inflation at 2% and that monetary policy stance will quickly shift to a neutral rate later this year .

May raise interest rates by 50 basis points or no suspense

According to CME’s “Federal Reserve Watch”, as of April 20 (Wednesday), the probability of the Fed raising interest rates by 25 basis points by May is 6.8%, the probability of raising interest rates by 50 basis points is 93.2%, and the probability of raising interest rates by 75 basis points is 0%.

The probability of the Fed raising interest rates by 50 basis points by June is 0%, the probability of raising interest rates by 75 basis points is 4.1%, the probability of raising interest rates by 100 basis points is 58.6%, and the probability of raising interest rates by 125 basis points is 37.3%.

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