The Mitsubishi UFJ gave an analysis of four scenarios for the Federal Reserve's interest rate decision this week. The benchmark scenario was for hawks to suspend interest rate hikes, followed by neutral suspending interest rate hikes and dovish suspending rate hikes. The probability of hawks raising interest rates is 5%. Under the benchmark scenario, the agency believes that the overall style of Federal Reserve Chairman Walsh's many speeches and previous FOMC press conferences is hawkish. He is not expected to release any forward-looking guidance, but he will definitely be asked about recent inflation figures that have greatly exceeded expectations. If he fully acknowledges the latest inflation signals and at the same time reaffirms that “the inflation problem requires active choices and responses,” it will further strengthen the hawkish policy trend.

The Mitsubishi UFJ gave an analysis of four scenarios for the Federal Reserve's interest rate decision this week. The benchmark scenario was for hawks to suspend interest rate hikes, followed by neutral suspending interest rate hikes and dovish suspending rate hikes. The probability of hawks raising interest rates is 5%. Under the benchmark scenario, the agency believes that the overall style of Federal Reserve Chairman Walsh's many speeches and previous FOMC press conferences is hawkish. He is not expected to release any forward-looking guidance, but he will definitely be asked about recent inflation figures that have greatly exceeded expectations. If he fully acknowledges the latest inflation signals and at the same time reaffirms that “the inflation problem requires active choices and responses,” it will further strengthen the hawkish policy trend.