The Fed didn’t raise rates on May the 2nd, but they did keep the markets prepared for a hike at the next meeting in June. In addition, they noted that inflation had ticked up, albeit slightly. Wage pressures are beginning to come through the data and business investment has strengthened.
No real surprises, but it will be interesting to see where inflation goes from here and how much restraint they exercise from this point forward. With inflation benign for so long, it seems like they could easily be slow to respond. No doubt, we can expect rate volatility all along the curve as the markets react to every new piece of data.