The market is sending signals that the Federal Reserve may not make much headway raising interest rates during the next two years—even if central bankers are intent on doing so, Jonathan Golub, chief U.S. market strategist at RBC Capital Markets, said on Tuesday.
The Fed will not be able to raise its federal funds rate above 1.5 percent by the end of 2017, Golub said. If it tries to do so, the dollar will start to rise, putting pressure on the economy and causing the central bank to retreat.
“I would love to see the Fed be able to move toward 2 percent, but with free money in Europe, it’s very hard for them to get tighter,” he told CNBC’s “Squawk Box.” “Are we asking the permission of the Europeans for our central bank policies? I’m not sure, but the market’s saying [we are].”
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