U.S. Outlook: FOMC scales back rate hike expectations

Posted By Scott Anderson In Economic Outlook | No Comments

This week the Federal Open Market Committee (FOMC) aligned its expectations for the Fed funds target rate lift-off more closely with the market’s.

Graph showing recent drop in U.S. exports [1]The implication is that the FOMC blinked a bit, giving in to market guidance on interest rates.

For a detailed look at this and other developments this week, see my full analysis. Highlights are outlined below, followed by a link to the full U.S. Outlook report, delivered on March 20.

Key observations:
  • While the first rate hike from the Fed could theoretically come in June, September is looking more likely given the revised “dot-plot” guidance from the Fed.
  • The major trade weighted dollar index is now approaching 12-year highs.
  • In less than a month, the dollar has gained nearly 8% against the euro.
  • With global oil prices yet to find a bottom, low inflation could remain longer than currently anticipated.

Click here to read my full report. [2]

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URL to article: https://changematters.bankofthewest.com/2015/03/20/u-s-outlook-fomc-scales-back-rate-hike-expectations/

URLs in this post:

[1] Image: http://blog.bankofthewest.com/wp-content/uploads/2015/03/graph_exports_032015.jpg

[2] Click here to read my full report.: http://blog.bankofthewest.com/wp-content/uploads/2015/03/BankoftheWest_USOutlook_03_20_15.pdf

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