Fed minutes highlight a committee that want to raise rates – Deutsche Bank

Research Team at Deutsche Bank, notes that the Fed minutes last night highlight a committee that continues to want to raise rates whenever they can push it through.

Key Quotes

“However what normally happens after such hawkishness in the current environment is either the data doesn't ever quite get there for them to pull the trigger or the global market takes fright by enough for them to have to postpone their plan. I'm not sure this time is any different but clearly you can try to trade the volatility between the two points.

Indeed the probability of a June hike has moved from 4% on Monday to 32% after last night's minutes. Contracts further out in the year have also seen a reasonable re-pricing. The probability of a July move is now up to 47% from 28% just prior to the minutes and 19% on Monday, while a move by December has gone from 56% at the start of the week to 65% on Tuesday and to 75% post minutes.”