FOMC expectations – 75% chance of hike in Sep – UBS

FXStreet (Guatemala) – Analysts at UBS noted the forth coming event in the FOMC and commented.

Key Quotes:

“We expect Chair Yellen to continue setting the stage for the start of the Fed’s tightening cycle later this year. If market expectations are correct, the June FOMC meeting will be the last quarterly update to the FOMC’s forecasts before the Fed at the September 16-17 FOMC meeting hikes rates for the first time in more than nine years. (The previous rate hike was on June 29, 2006.)”

“Market participants are focused on the upcoming meeting despite no expectation that the Fed funds target rate will be immediately increased.”

“We do not expect the post-meeting statement, the forecast or the press conference to prompt a rethinking of current market expectations. As of Friday the markets were pricing in a bit more than 75% chance of a rate hike at the September FOMC meeting. We believe the FOMC is currently comfortable with that view and is cognizant of the fact that there are ample opportunities to reset market expectations, if needed, before the September meeting.”

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Analysts at UBS noted the forth coming event in the FOMC and commented.

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