Hawkish FOMC expected next week – TDS

Strategists at TD Securities see the FOMC meeting to be tilted towards the hawkish side next week.

Key Quotes

“The Fed will balance near-term uncertainty (health of the labor market following the May report, UK referendum outcome) with a generally upbeat outlook for the economy”.

“Governed by data dependence, the Fed will remain vague on the exact timing of the next rate hike and will again emphasize the theme of gradualism”.

“The SEP should see modest tweaks while the median dots are not likely to change. The absence of renewed dovishness will lead to a hawkish market response”.