Fed to signal willingness to accommodate fiscal boost

Incoming President Job Biden signed a flurry of executive orders during his first couple of days in office, but it remains to be seen whether the divided Senate will support his broader agenda, particularly his call for more large-scale fiscal stimulus. We expect the Fed to stand pat at next week’s FOMC meeting but, in his post-meeting press conference, Chair Jerome Powell could add his support for more fiscal action – and reassure that such action wouldn’t prompt the Fed to tighten monetary policy any time soon.