29 Jan 2015
Fed rate hike still in pipeline –Hilsenrath
FXStreet (Barcelona) - Wall Street Journal’s Fed watcher Jon Hilsenrath writes the Federal Reserve is still on course to raise interest rates as new hints of “hawkish” and “dovish” leanings seem to balance out.
The Fed statement did not comment on the surging US dollar but did express concerns regarding developments in the international markets. Mr. Hilsenrath notes the dollar is under the scanner. He states that though the economy is expanding at a ‘solid’ pace, policymakers in general see it expanding at a moderate pace ahead. Furthermore, the drop in the inflation is characterized as a temporary phenomenon.
He believes the Fed wants to hike in the middle of the year. The interest rate market implies only about a 12% chance of a rate hike in June.
In his article he states, “Officials see many conflicting signals right now emanating from oil prices, headline inflation, international developments and bond markets. They clearly don’t want to get ahead of themselves in making judgments about what these developments mean. But with the labor market on track, they appear to have decided to stay the course toward rate increases this year, and concluded June can’t yet be taken off the table”.
The article has not yet had any significant impact on the FX markets.
The Fed statement did not comment on the surging US dollar but did express concerns regarding developments in the international markets. Mr. Hilsenrath notes the dollar is under the scanner. He states that though the economy is expanding at a ‘solid’ pace, policymakers in general see it expanding at a moderate pace ahead. Furthermore, the drop in the inflation is characterized as a temporary phenomenon.
He believes the Fed wants to hike in the middle of the year. The interest rate market implies only about a 12% chance of a rate hike in June.
In his article he states, “Officials see many conflicting signals right now emanating from oil prices, headline inflation, international developments and bond markets. They clearly don’t want to get ahead of themselves in making judgments about what these developments mean. But with the labor market on track, they appear to have decided to stay the course toward rate increases this year, and concluded June can’t yet be taken off the table”.
The article has not yet had any significant impact on the FX markets.