Crescenzi: Where's the Fed?

Editor's note: This column originally appeared on RealMoney at 9:30 a.m. EDT.

The federal funds rate is trading at 3.75% this morning, well above the Fed's 2% target.

Typically, when the funds rate is above the Fed's target rate, the Fed adds money into the banking system. The inaction creates suspicion about whether the Fed is preparing to announce an interest rate cut.

Perhaps the Fed is waiting for the dust to settle on the many position unwindings that are taking place this morning before making a judgment about the need for money in the banking system. Alternatively, the Fed is engaged in a conference call to discuss any actions to take.