FXStreet (Guatemala) – Derek Halpenny, analyst at Bank of Tokyo Mitsubishi explained that Yellen’s speech has prompted a shift in the probability of a federal funds rate increase in December.
Key Quotes:
“Based on the effective federal funds rate being at 0.14% prior to an increase on 16th December, the probability of a hike looks to have shifted from 52% to 64%. The 2-year UST bond yield also jumped back above the 0.70% level and certainly the short-end of the US yield curve is set to remain very sensitive to EM developments given this speech from Yellen reinforces the fact that only developments abroad are holding the FOMC back from hiking.”
(Market News Provided by FXstreet)