FOMC Interest Rate Decision

What it is

The Federal Open Market Committee sets the target range for the federal funds rate, the overnight rate that anchors US borrowing costs. Economic calendars usually quote the upper bound of that range as a single percentage. The decision and accompanying statement are released together; at four meetings a year the Committee also publishes its Summary of Economic Projections, and the Fed Chair typically holds a press conference about half an hour after the decision. The FOMC holds eight regularly scheduled meetings a year, spaced roughly six to eight weeks apart, per the calendar the Federal Reserve publishes at federalreserve.gov; it can also meet and act between scheduled meetings if conditions warrant.

Why it matters to traders

The federal funds rate is the anchor for global dollar funding costs, so the decision is one of the biggest scheduled drivers of the dollar, gold, US equities and the Treasury curve. Because the outcome is often well telegraphed, the statement's wording and the press conference Q&A frequently move markets more than the rate decision itself, as traders hunt for the path of future policy.

Trade the reaction across the major currency pairs, world indices and commodities, follow the story in market news, and record your setup in the FXMARE trading journal.