The Fed Funds rate is not the signpost of Fed monetary policy. It can be ignored until quantitative easing is retired.
There are sufficient doubts about the US economy to keep markets from being secure that QE is ending until that first reduction in bond and MBS purchases is announced and even then doubts will linger.
Generic 10-year Treasury yields (2.61% close today) are still only 55% of the historical average for the decade before June 2008 (4.76%).
The recent low in the 10-year yield was 1.62% on May 3rd. Taking that as the starting point for the normalization of rates to their pre-crash decade average, rates have moved a bit less than one-third of the way (31.5%) to their goal (basis points, 2.61%-1.62%/4.76%-1.62%.)
The next FOMC meeting is July 30-31.
Chief Market Strategist
Fed Funds Effective Rate
Generic 10-Year Treasury