JustChartsWhat Is the FOMC? How Fed Interest-Rate Decisions Move Markets
The FOMC (Federal Open Market Committee) is the Federal Reserve committee that sets the US federal funds rate. It holds eight scheduled meetings a year, announcing its decision at 2:00 p.m. New York time, followed by the Fed Chair’s press conference at 2:30 p.m. A more hawkish (higher-rate) outlook than expected usually lifts the dollar and weighs on gold and stocks.
Key facts
- Meetings per year
- 8 scheduled (plus emergency meetings if needed)
- Decision time
- 2:00 p.m. New York time
- Press conference
- 2:30 p.m. New York time
- Dot plot
- March, June, September and December meetings
- Minutes
- published three weeks after each meeting
Who is on the FOMC?
Twelve voting members: the seven governors of the Federal Reserve Board, the president of the New York Fed, and four of the other eleven regional Fed presidents on a rotating basis. The Fed Chair leads the committee and the press conference.
What does the FOMC decide?
- The federal funds target range — usually changed in steps of 0.25 percentage points.
- Balance-sheet policy — buying bonds (quantitative easing) or letting them run off (quantitative tightening).
- Guidance — the statement and press conference signal what the Fed may do next.
What is the dot plot?
At four meetings a year (March, June, September and December) the Fed publishes its Summary of Economic Projections, including the “dot plot”: each official’s anonymous forecast for interest rates over the next few years. Markets compare the dots with their own expectations.
How FOMC decisions move markets
| Market | More hawkish than expected | More dovish than expected |
|---|---|---|
| US dollar | Up | Down |
| Gold | Down | Up |
| US stocks | Usually down | Usually up |
| Bond yields | Up | Down |
Decisions are often fully expected, so the reaction comes from the statement wording, the dot plot and the press conference. It is common to see one move at 2:00 p.m. and a reversal during the press conference at 2:30 p.m.
Trading around FOMC
Spreads widen and liquidity thins just before 2:00 p.m. New York time. Many traders reduce size or wait for the press conference to finish. Inflation (CPI) and jobs data (NFP) shape what the Fed does, so they move markets in the run-up to each meeting.
Frequently asked questions
What time is the FOMC announcement?
At 2:00 p.m. New York time on the final day of the meeting, followed by a press conference at 2:30 p.m. That is 18:00 or 19:00 UTC depending on daylight saving.
How many times a year does the FOMC meet?
Eight scheduled times a year, about every six weeks. It can also hold unscheduled meetings in emergencies.
What does hawkish mean?
Hawkish means leaning towards higher interest rates to fight inflation; dovish means leaning towards lower rates to support growth and jobs.
Why does gold fall when the Fed raises rates?
Higher rates increase the return on cash and bonds and usually strengthen the dollar, both of which make non-yielding gold less attractive.
Put it into practice
Live charts, an economic calendar and trading calculators — free with a JustCharts account.
See the next FOMC decision with a countdownThis article is for education only and is not financial advice. Trading leveraged products carries a high risk of losing money. Contract sizes, trading hours and leverage limits vary by broker and country — always check your own broker’s specifications.