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Three things await the Fed and Powell markets



Here are three comments investors will expect on Wednesday afternoon.

. 1 Balance sheet . The Fed's balance sheet is now in the news after news reports that the program is being discussed by Fed officials forever and not forever "autopilot".

"It's clearly one of the main topics to be discussed," said Luke Tilley, chief economist at Wilmington Trust. "I think it will be a fairly uneventful meeting regarding the information we receive as a public." However, Tilley expects the Fed to debate what level it wants to take on its balance sheet, and Fed officials are likely to present a presentation.

As for the Powell observers, the Fed's observers expect the accounting policy and reporting to be flexible note that it is in review.

. 2 " Patience and Flexibility" . Powell noted that the Fed may have "patience" when it formed with former central bank chiefs Ben Bernanke and Janet Yellen in early January. That was a reassuring sentence, and the markets expect to hear again.

"I think they need to add some language about patience and patience, which is exactly what the markets want right now," Harris said.

3. Listen to data and markets. Data dependency gets a new meaning. It is expected that Fed officials will continue to emphasize that they will base interest rate decisions on incoming data rather than moving according to a set timetable. However, Fed observers expect them to point out that they will pay attention to the kinds of messages they can get from markets and business leaders.

Powell is also likely to be asked to discuss what the Fed has done without weeks of government data unavailable due to the government's cessation.

"A good reason to expect the press conference is that Powell puts the patience and prudence and evaluation of the data to the forefront of the Fed to be reluctant," said Ben Jeffrey, a strategist at BMO.


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