US: Expect a Single Fed Hike this Year - SocGen
Kit Juckes, Research Analyst at Societe Generale, suggests that the FOMC
Minutes themselves don’t tell us much we didn’t already know.
Key Quotes
“Members
continued to expect that, with gradual adjustments in the stance of
monetary policy, economic activity would expand at a moderate pace and
labor market indicators would continue to strengthen. However, they saw
global economic and financial developments as continuing to pose risks.”
There’s no reason to alter a view that the Fed is likely to
raise rate since this year, nor to alter a view that the Fed is watching
markets every bit as closely as the US economy. We expect a single hike
this year. And to be fair, there is nothing here to help the dollar;
the only question is at what point the combination of decent US data
(jobs, ISM in recent days) and ‘riskon’ mood change the market’s
perception of Fed risks.
The Dollar index (DXY) is testing last
October’s lows this morning, and looks sickly. A broader trade weighted
dollar index is already below October’s lows and threatening a move to
May 2015s.”
(Market News Provided by FXstreet)
