U.S. Outlook: Preview of next week’s FOMC meeting
The Fed funds future market is currently putting a 99.3% probability on another rate hike on Wednesday.
Investors will be trying to divine what it all means for the expected Fed funds rate hike path over the rest of the year and 2019.
For more on this, see highlights of my report below, followed by a link to the full U.S. Outlook, delivered on March 16.Key observations:
- Will the Fed median “dot plot” migrate toward four rate hikes this year from the three hikes penciled in last December when Janet Yellen was at the helm?
- I have not materially lifted our forecast for real GDP for 2018 and 2019 as a result of the additional government spending, and our estimates of real GDP growth for 2018 and 2019 are somewhat below the Fed’s December median estimates.
- We are forecasting three quarter-point rate hikes in 2018 and one more in 2019.