Federal Reserve's post-FOMC statement last week disclosed their deliberation in considering December rate hike. However, it is also publicly known that whether rate hike is possible or not will be determined by developments on many factors ahead.

Federal Reserve's post-FOMC statement last week disclosed their deliberation in considering December rate hike. However, it is also publicly known that whether rate hike is possible or not will be determined by developments on many factors ahead of December FOMC. These factors include vital macroeconomic indicators and Fed officials' outlook on the most recent economic situations.

Thus, these are seven key events that needs to be noted before Federal Reserve meets in December 2015:

 

1. US Third Quarter GDP

When: November 24 (revision)
Although GDP growth is not one of the Fed's main consideration, but this data indicates the strength of the country's economy to withstand rate hike and attain the expected full-employment and inflation.

GDP

Last week, US GDP for the third quarter of 2015 was disappointing. Growth was just at 1.5 percent (yoy), lower than the estimated 1.6 percent and worse than final GDP of the second quarter which exceeds expectations at 3.9 percent. However, many analyst sees the slowdown as a temporary aberration. The data will be updated in November 24th. 

 

2. US Inflation Rate

When: November 25
Fed is known to be closely following PCE index. In the circumstances, it will be more worthwhile to monitor PCE releases from US Bureau of Economic Analysis rather than the common inflation rate data released by US Bureau of Labor Statistics. September PCE was released in October 30, while October PCE will be published in November 25.

September PCE was at 0.16 percent, lower than 0.32 percent in the previous period. Meanwhile, Core PCE Index stagnated at 1.31 percent. Core PCE's general trend indicate disinflation as seen on the picture below; instead of walks near Fed's 2 percent target, consecutive figures get further away.

Indeks

 

3. Janet Yellen

When: November 4, December 2, December 3
Fed Chief Janet Yellen is scheduled to speak in three occasions within the next few weeks: a testimonial in front of US House of Representative's Financial Services Committee, a speech in The Economic Club of Washington, and a testimonial in front of Congress' Joint Economic Committee.The topic for the first testimonial is actually not related to economy, but discussions may diverge. On the other hand, the last two events clearly grants Yellen many chances to convey her thoughts on how US economy develops.

 

4. Stanley Fischer

When: November 4
Fed Vice Chief Stanley Fischer will speak in The National Economists Club this week. As one of the Fed's top brass, Fischer may deliver new insights for market players to consider. He is considered as one of the less dovish member of FOMC, although not exactly a centrist. A few weeks ago, he has expressed his support for Fed rate hike before the end of the year.

 

5. US Employment Rate

When: November 6, December 4
Post October FOMC, Fed officials admitted that the country's job growth have stalled. In September, they have said to target 4.9 percent of long-term unemployment rate. If it doesn't change then the latest figure at 5.1 percent should be unsatisfactory to warrant a rate hike. Nonetheless, there are two more job reports before December FOMC is held. The first will be announced along with Nonfarm Payrolls on Friday.

Tingkat

 

6. William Dudley

When: November 12
New York Fed President and FOMC voting member, William Dudley, is scheduled to make an appearance in The Economic Club of New York to speak about economic outlook and monetary policy next week. Dudley sometimes is considered as the third most important person in FOMC after Yellen and Fischer, which means his speech will be monitored closely. He is on the same 'dovish level' as Yellen, a notch below Fischer.

 

7. October FOMC Meeting Minutes

When: November 18
As usual, FOMC meeting minutes will be published two weeks after the meeting ends. It means minutes from the last meeting in October will be available for public in November 18. The minutes may disclose the reason why October FOMC meeting consider it likely to hike rates in December. Previous FOMC meeting minutes generally do not inflict significant impact although they garner attentions.