25 Mar 2015
Fed to hike Q4 and not sooner? - Raboabank
FXStreet (Guatemala) - Analysts at Rabobank explained in respect of the Fed, having removed its forward guidance, the Fed is now completely turning to the economic data again.
Key Quotes:
"On balance, these data have only raised doubts in the market about whether a mid-year hike is possible."
"Uncertainty about this elephant in the room is keeping US rates from rising rapidly. We stick to our forecast of a rate hike in Q4, in part because of the strong dollar."
"Remarks by two key Fed officials, Messrs. Stanley Fischer and John Williams corroborated that view. The first said that raising interest rates “likely will be warranted before the end of the year”, although “a smooth path upward in the federal funds rate will almost certainly not be realized”. Williams told an Australian audience that “[…] by mid-year it will be the time to have a discussion about starting to raise rates.” We would emphasize that “a discussion” implies data-dependency."
Key Quotes:
"On balance, these data have only raised doubts in the market about whether a mid-year hike is possible."
"Uncertainty about this elephant in the room is keeping US rates from rising rapidly. We stick to our forecast of a rate hike in Q4, in part because of the strong dollar."
"Remarks by two key Fed officials, Messrs. Stanley Fischer and John Williams corroborated that view. The first said that raising interest rates “likely will be warranted before the end of the year”, although “a smooth path upward in the federal funds rate will almost certainly not be realized”. Williams told an Australian audience that “[…] by mid-year it will be the time to have a discussion about starting to raise rates.” We would emphasize that “a discussion” implies data-dependency."