^GSPC Today, January 29: Fed Holds Rates as Powell Defends Independence
The FOMC decision to hold rates at 3.50%-3.75% on 29 January keeps policy steady while Jerome Powell defended the Fed’s independence. The statement raised the bar for near-term cuts, pointing to a patient path to easing. Markets now look to labor and disinflation trends, with many expecting no change until June. For Singapore investors, this affects equity exposure, USD hedging, and REIT sensitivity to yields. We outline the S&P 500 reaction, key technical levels, and the data that matters next.
What the Fed said and what changed
The Committee left the target range at 3.50%-3.75% and signaled caution on further near-term cuts. The wording suggests the bar is higher before easing resumes, with progress on inflation still required. A patient approach keeps optionality if data softens. This tone reduces the chance of a quick pivot and aligns expectations with a later first move.
Powell underscored that policy choices will follow data, not politics. That message aims to anchor credibility and inflation expectations, which supports longer-term stability. For background on the stance and context, see coverage by Channel NewsAsia and details on the statement changes from CNBC.
S&P 500 setup after the Fed
The ^GSPC hovered near 6,978 with a day high at 7,002.28, brushing the Bollinger upper band at 6,980.35. RSI at 57.52 shows moderate momentum, while ADX at 12.18 signals no strong trend. The MACD histogram is positive at 2.78, hinting at steady upside pressure. This S&P 500 reaction fits a hold-and-wait stance as investors parse incoming data.
Nearby resistance sits around 6,980 to 7,002. A pullback may find support near the Bollinger middle band at 6,866.40 and the Keltner middle at 6,870.04. ATR at 59.05 implies typical daily swings of about 59 points. A close above 7,002.28 would confirm a breakout, while a move under 6,866 could open room toward 6,752 on the lower band.
Implications for Singapore investors
A steady Fed path keeps USD rates elevated for longer, which can affect USD/SGD and funding costs. Singapore REITs and bond proxies remain rate sensitive. Equity investors may favor quality growth and cash-generative names. The FOMC decision also supports disciplined hedging of USD exposure for global portfolios, while keeping dry powder ready if valuation dips emerge.
We prefer staggered entries into broad US equity exposure, including S&P 500 ETFs, while trimming richly valued pockets on strength. Maintain a barbell of defensives and selective cyclicals. Consider short-duration income for flexibility ahead of potential mid-year easing. Keep REIT exposure balanced with yield and asset quality. Review hedges as volatility rises around key data releases.
Data that can shift the path to June
Jobs, wages, and inflation will drive the next moves. Watch nonfarm payrolls, unemployment, and average hourly earnings for signs of cooling. On prices, core PCE and CPI trends matter most for the FOMC decision. Softer labor demand and steady disinflation would support cuts later, while sticky services inflation could delay the timeline.
Statement language and press conference tone offer early hints. Track descriptions of inflation progress and the balance of risks in each Fed meeting. Compare redlines in future statements with January’s update to spot shifts in bias. For a clear breakdown of changes, review CNBC’s analysis and broader context from Channel NewsAsia.
Final Thoughts
The FOMC decision kept rates at 3.50%-3.75% and set a higher bar for near-term cuts. Powell’s defense of independence supports credibility, which anchors expectations while the Fed waits for clearer disinflation and softer labor data. For Singapore investors, this points to patient risk-taking, steady hedging of USD exposure, and selective adds on dips. On the S&P 500, watch 6,980 to 7,002 for a breakout and 6,866 for support, with ATR near 59 guiding position sizing. Over the next few months, jobs and core PCE will steer timing toward a potential June move. Stay data-led, keep portfolios balanced, and reassess after each release.
FAQs
What was the FOMC decision on January 29?
The FOMC decision kept the federal funds rate at 3.50%-3.75%. The statement raised the bar for additional near-term cuts, stressing the need for more evidence that inflation is moving sustainably lower. This patient stance shifts attention to upcoming labor and inflation data that can influence the timeline for any easing.
How did the S&P 500 react to the Fed meeting?
The S&P 500 hovered near recent highs, with the index around 6,978 and a day high at 7,002.28. Momentum is moderate with RSI at 57.5 and no strong trend per ADX near 12. Price action suggests a wait-and-see approach as investors parse labor and disinflation signals.
What does Powell’s emphasis on independence mean for markets?
Powell’s emphasis on independence signals that policy will follow data, not politics. This supports credibility and helps anchor inflation expectations. For investors, this reduces policy surprise risk and encourages a focus on fundamentals, particularly labor, wages, and core inflation readings that will guide the pace and timing of any rate cuts.
What should Singapore investors do after this Fed meeting?
Use a patient, data-led approach. Consider staggered entries into broad US equity exposure, keep some dry powder, and maintain hedges for USD exposure. For rate-sensitive assets like REITs, focus on balance sheet quality and lease strength. Watch jobs and core PCE data, which will shape timing toward a possible June policy shift.
Disclaimer:
The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.
