Key points
- Watch for word changes in statements.
- Tone matters: "substantial" vs "modest".
- Chair's press conference is key event.
Example
Changing one word in the policy statement, for example dropping a reference to "further increases", can shift market expectations for rates over the coming year.
In history
In a November 2022 speech, Jerome Powell said the time to slow the pace of rate rises "may come as soon as December". The S&P 500 rose about 3% that afternoon.
Related terms