Amundi, the forecasts on the Fed and ECB in view of the next meetings

After the twists and turns of September, the next FOMC meeting should not hold any surprises, with the Fed destined to remain on pause. It is true that the labor market now appears less solid and that market rates remain high. However, the inflation outlook has not changed, so the Fed still has room to reduce the degree of monetary policy accommodation. Patience should not be confused with complacency.

The European Central Bank is expected to keep monetary policy unchanged on Thursday, but will continue to strike a restrictive tone. Above all, we are witnessing a new moment in which the market is testing the central bank. It is likely that the ECB will acknowledge the tensions verbally, but without taking concrete action. The market will watch carefully to understand how much the safety net is actually available and under what conditions it can actually be activated.