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As of writing, the CME's FedWatch tool shows that Fed Funds Futures traders think it's more likely than not that the Fed will be able to raise interest rates thrice this year, making it the first time in years that the Fed has not been far more optimistic than the market as a whole!
U.S. Treasury yields hit session highs before flattening while stocks were largely unchanged on Friday after Federal Reserve Chair Janet Yellen said the Fed is set to raise its benchmark interest rate this month as long as economic data on jobs and inflation holds up.
The minutes from the Federal Reserve on Wednesday, which we were hoping would provide additional clarity on its interest rate expectations, instead displayed the uncertainty the central bank has about how to proceed, largely due to the unknown effects of what Donald Trump’s stimulus plans will have on the economy and inflation.
Oil traders from around the world, including the United States, Britain and Brazil, have tripled their sales to Asia as they take advantage of an emerging supply gap following OPEC-led production cuts announced late last year.
Super Thursday marks the day once a quarter when the Bank of England announces its latest monetary policy decision, releases the minutes of the meeting, its quarterly inflation report including new forecasts and Governor Mark Carney chairs a press conference. Needless to say, it’s often quite an eventful day, particularly in post-Brexit Britain when so much uncertainty exists for the economy.
The Federal Reserve kept interest rates unchanged on Wednesday in its first meeting since President Donald Trump took office, but painted a relatively upbeat picture of the U.S. economy that suggested it was on track to tighten monetary policy this year.
Information received since the Federal Open Market Committee met in December indicates that the labor market has continued to strengthen and that economic activity has continued to expand at a moderate pace. Job gains remained solid and the unemployment rate stayed near its recent low.
Whether you consider 2016 a good or a bad year, it was by no doubt the year of surprises. Not just because Donald Trump was elected the 45th president of the United Stated or because the UK decided to leave the EU, but the markets’ reactions to these events were even more surprising and most forecasters got it wrong.
In the 1993 movie Groundhog Day, Bill Murray plays an arrogant weatherman who gets stuck in a "time loop" and is forced to relive the same day hundreds of times. Lately, the Federal Reserve has been feeling a bit like Bill Murray on a slightly longer timeframe. Tell me if this sounds familiar...
Global equities, currencies and commodities took a hit after the Federal Reserve’s decision to raise interest rates on Wednesday for the second time in a decade. The 25-basis points increase was almost fully priced in and didn’t take market participants by surprise, but the strong reaction seen in the dollar and U.S. bond yields was due to the new projections for 2017, which showed the central bank now expects three rate hikes for 2017 rather than only two seen in September.