Fed-related news tracking
2026
Jan15
The Federal Reserve's discount window lending balance fell to $5.37 billion for the week ending January 14, down from $7.23 billion the previous week. This continues a downward trend from the week ending January 7, when the balance was $7.23 billion, and the week ending December 31, when it stood at $9.66 billion.
The Federal Reserve's balance sheet update shows a continued reduction, with the total size dropping to approximately $6.57 trillion in January 2026 from a previous $6.64 trillion . This continues the trend of quantitative tightening (QT) from a peak of around $9.1 trillion in 2022 . The balance sheet had fallen to $6.54 trillion by the end of December 2025 . This ongoing reduction occurs as Fed officials like Philadelphia Fed President Harker signal potential future rate cuts contingent on cooling inflation , and after the release of the latest Beige Book .
On Thursday, January 15, 2026, the usage of the Federal Reserve's overnight reverse repurchase agreement (RRP) facility fell to $2.003 billion with 6 counterparties, a significant decrease from the previous day's $3.223 billion. This drop follows a period of elevated year-end demand for the Fed's liquidity tools, such as the Standing Repo Facility (SRF), which saw record borrowing of $74.6 billion on the last day of 2025 to manage year-end liquidity needs. The normalization of RRP usage indicates that these temporary pressures have subsided.
In the week ending January 14, U.S. seasonally adjusted commercial paper outstanding fell by $1.5 billion. However, the non-seasonally adjusted figure, which some analysts view as more reliable, surged by $44.6 billion to $1.412 trillion. This included an $18.5 billion increase in foreign financial commercial paper.
Jan14
According to CME's "FedWatch" tool, the probability of the Federal Reserve maintaining its current interest rate in the January meeting is 95%, with only a 5% chance of a 25 basis point cut. This consensus has strengthened from around 83% in early January. The shift is largely due to robust economic data, particularly a surprise drop in initial jobless claims, which reinforces a high-rate environment and has pushed market expectations for the first rate cut to June. Consequently, the probability of a rate cut by March has fallen to 26%.
The Fed's Beige Book indicates that economic activity saw slight to moderate growth in eight of its twelve districts, an improvement from previous reports . This was largely driven by consumer spending during the holiday season, with high-income households showing particularly strong spending on luxury goods, travel, and experiences . While employment levels were stable and wages grew moderately, some firms began passing on tariff costs, pressuring margins . Fed officials remain cautious about rate cuts due to above-target inflation, and investors don't anticipate a cut before June .
Fed Governor Stephen Millan argued that the Trump administration's deregulation agenda justifies further interest rate cuts. He posits that deregulation will boost productivity and growth without inflation, estimating it could lower inflation by 0.5 percentage points by eliminating 30% of regulations. This supports his consistently dovish stance, where he has advocated for aggressive cuts of over 100 basis points in 2026 to avoid economic contraction, a view that contrasts with other officials. This comes amid warnings from business leaders like Jamie Dimon that political pressure on the Fed could backfire, raising inflation expectations and long-term rates.
Philadelphia Fed President Anna Paulson, a voting member in 2026, stated that a small interest rate cut may be appropriate later in the year. This is conditional on the economy maintaining a favorable trajectory, including economic growth around 2%, a stable labor market, and inflation trending down towards the 2% target. Paulson expressed 'cautious optimism' about inflation and noted that rising labor market risks were a significant factor in her support for last year's rate cut.
Jan13
The U.S. unadjusted core CPI for December rose 2.6% year-over-year, which was below the market expectation of 2.7% but flat with the previous month's reading. The headline CPI came in at 2.7%, meeting both forecasts and the prior month's figure.
Jan12
Fitch Ratings stated that the Federal Reserve's independence is a key supporting factor for the 'AA+' U.S. sovereign rating. The agency will monitor governance and the Fed's performance on inflation. This comes amid rising political pressure on the Fed from the Trump administration, including threats of legal action against Chair Powell, which has sparked market volatility and a "sell America" sentiment. Former Fed chairs and Treasury secretaries have condemned the pressure as an "unprecedented attack" on the central bank's independence.
On Monday, January 12, the usage of the Federal Reserve's Overnight Reverse Repo (RRP) facility was $3.402 billion, a slight increase from the previous day's $3.28 billion. This follows a period at the end of 2025 where financial institutions borrowed a record $74.6 billion from the Fed's Standing Repo Facility (SRF) to manage year-end liquidity needs.
On January 12, JPMorgan reversed its forecast for the U.S. Federal Reserve, no longer expecting a rate cut in 2026 and now predicting a 25 basis point rate hike in the third quarter of 2027. This change followed a recent jobs report and marks a significant shift from their previous expectation of a 25 basis point cut in January 2026.
Jan11
According to CME 'FedWatch' data, the probability of the Federal Reserve maintaining its current interest rate in January stands at 95.6%, with the chance of a 25 basis point cut at only 4.4%. This marks a significant shift from early January when the probability of a hold was around 85%. Consequently, expectations for a March rate cut have also diminished, with the probability falling to 27.6% from over 50%. This repricing follows recent economic data, particularly on employment, which has led firms like Goldman Sachs to postpone their forecast for the first rate cut from March to June 2026.
Jan09
The likelihood of an interest rate cut by the Federal Reserve at the January 28 FOMC meeting has decreased, with traders now estimating a 5% chance, down from 11.1%. The December unemployment rate was 4.4%, better than expected, while wage growth rose by 3.8%. Despite a weaker nonfarm payroll increase of 50,000 jobs in December, the overall labor market strength is leading to reduced expectations for rate cuts, as higher wages may keep inflation elevated.
The U.S. unemployment rate has decreased, leading traders to bet more heavily on the Federal Reserve pausing rate cuts. According to the latest employment data, traders expect the Fed to cut rates by 50 basis points this year. Polymarket data shows a 96% probability that the Fed will not cut rates in January, with only a 5% chance of a rate cut.
Following the release of non-farm payroll data, the probability of the Federal Reserve maintaining interest rates in January has increased to 97.2%, while the likelihood of a 25 basis point rate cut has dropped to 2.8%.
Ahead of the non-farm payroll data release, the probability of the Fed cutting rates by 25 basis points in January is 11.6%, with an 88.4% chance of no change. By March, the probability of a cumulative 25 basis point cut is 35.8%, with a 60.6% chance of no change, and a 3.7% chance of a 50 basis point cut.
Jan08
The Federal Reserve's discount window loan balance fell to $7.23 billion for the week ending January 7, down from $9.66 billion the previous week.
The Federal Reserve has provided detailed information on its balance sheet, which includes significant liabilities such as loans through the Standing Repo Facility (SRF) and assets like U.S. Treasury securities.
The Congressional Budget Office forecasts that the Federal Reserve will cut rates slightly this year to mitigate risks to the labor market. Short-term borrowing costs are expected to decrease to 3.4% by Q4 2023 and remain stable until 2028. The CBO also predicts U.S. unemployment will end 2023 at 4.6%, dropping to 4.4% by 2028, while inflation is expected to ease to 2.7% this year and further to 2.1% by 2028.
