Fed’s Year-End Meeting Signals Balance-Sheet Expansion and 2026 Policy Outlook Amid Dissent
COINOTAG News reports that the Federal Reserve will deliver its final rate decision of the year, with the decision due at 3:00 AM UTC+8 and Chair Powell briefing the media at 3:30 AM. Markets expect cues on policy direction and liquidity posture.
According to CME FedWatch, the odds of a 25 basis point rate cut are about 87.6%, underscoring a high likelihood. Beyond the cut, attention centers on whether the Fed will signal new liquidity injections and how internal disagreements could shape the 2026 trajectory.
The liquidity narrative has grown as the Fed has quietly paused balance sheet contraction. The Bank of America Global Rates Strategy team notes a potential expansion signal, with reserve management operations contemplated to purchase short-dated Treasuries at roughly $45 billion monthly.
Notably, the FOMC has not recorded three or more dissents in a single meeting since 2019, a rarity seen nine times since 1990. The outcome could crystallize intra-FOMC dynamics and the policy path for the coming years.