Daily Market Color December 12, 2019Fed and ECB Leave Policy Unchanged Fed leaves rates unchanged, confirms view that current monetary policy is appropriate. The Fed voted unanimously to keep the Fed Funds range unchanged at 1.50%-1.75%, adding in their statement that “the current stance of monetary policy is appropriate to support sustained expansion of economic activity.” The Fed also removed a previous reference to “uncertainties” from their FOMC statement, suggesting the central bank’s outlook is improving marginally. A new “dot plot” was also released, and shows near unanimous expectation for no rate changes in 2020. In his press conference, Jerome Powell said that he still believes there is slack in the labor market, helping to accelerate the rally in bond markets that started earlier in the day. The 10-year Treasury yield would ultimately fall 4 basis points to 1.79%. New ECB President Christine Lagarde announces that policy will remain unchanged and key rates will be kept steady. The ECB will assume an accommodative stance for a prolonged period as inflation developments will be closely monitored and will be ready to make any necessary rate adjustments. Lagarde added that economic data indicates that the slowdown in European economic growth has stabilized and will be further proven through employment gains and rising wages. Day ahead. With the ECB rate decision out of the way, markets will now turn their attention towards the UK election. Voting has already begun, and most final polls suggest that the Conservative party’s lead over Labour has narrowed. Voting will end at 5:00pm ET, a final result coming around midnight.