The consensus is that the Fed will keep its interest rate unchanged at the conclusion of this week’s meeting. Fed fund futures traders are pricing a 76.9% likelihood that the Federal Reserve will keep its interest rate stable this week, leaving the main policy rate target in the range of 5% to 5.25%, according to the CME FedWatch tool.The consensus is that the Fed will keep its interest rate unchanged at the conclusion of this week’s meeting. Fed fund futures traders are pricing a 76.
If the core inflation numbers arrive higher than anticipated, “I think we’ll see chances move much more closely to a coin toss for the Federal Reserve to hike on Wednesday, and then people who are expecting a kind of halt will dial back their expectations,” Giles Coghlan, chief market analyst at HYCM, said in a phone interview.
“The Fed wants to see 0.2% month-on-month or below CPI readings to be confident inflation will return to 2%,” Garvey wrote in a recent note. “We aren’t there yet so if they do hold rates steady [in June], as we predict, it is likely to be a hawkish hold with the door left open to further rate hikes if inflation doesn’t slow – July is clearly a risk.”
Source: News Formal (newsformal.com)
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