Opinion: experts SEB – wait for a fed rate hike in September?

“Although the fed Chairman is clearly hinted that a rate hike in September is still possible, the market participants estimate the probability of such an outcome in 40%. Only 15% of analysts predict a rate hike at the next FOMC meeting, which will take place in a few weeks. We checked the expectations for rates in the previous cycles of increase and found that decisions to increase rates were well fixed and widely expected. While the outcome of the September fed meeting will probably depend on Friday’s report on labor market, a rate hike is unlikely if the fed does not change current expectations. Based on the previous actions of the fed, we come to the conclusion that if the officials intend to raise interest rates at its forthcoming meeting on 21 September, in the coming weeks, the fed Chairman and other FOMC members should again be signaled to substantially change expectations. However, much will depend on Friday’s employment data. If they disappoint, the probability of a rate increase will remain below 50%, the rate increase in September will be unlikely,” – said the expert.

Opinion: experts SEB – wait for a fed rate hike in September? 01.09.2016

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