FXStreet (Guatemala) – Analysts at Rabobank explained that the dot plot released in December implies four rate hikes of a quarter this year.
Key Quotes:
“Today’s statement suggests that the FOMC is still contemplating how the global headwinds are affecting the balance of risks to the outlook. We have expressed our doubts about both the inflation outlook and the pace of the economic recovery from the beginning, and consequently also about the four rate hikes that the Fed intended to deliver this year.”
“We expect only two hikes with risks skewed to the downside. The next hike could even be delayed until next year and a rate cut is not unthinkable either if the US economy were to head south. However, the year is still long and despite the global headwinds the US services sector continues to grow and produce jobs at a strong pace, reducing labor market slack and bolstering the Fed’s confidence in the inflation outlook.”
(Market News Provided by FXstreet)