Prepare for a holiday hike.
That’s the message from the latest CNBC Fed Survey, where 90 percent of the 41 respondents say the Federal Reserve won’t increase interest rates at its September meeting this week. But 88 percent say the hike is coming in December.
“Expect the Fed to stay on the sidelines until after the election so they cannot be characterized as impacting the election in any way,” said John Roberts, senior vice president and director of research of Hilliard Lyons. “Recent economic statistics have been ambiguous enough to provide the Fed cover for such inactivity.”
But the near unanimity over what the Fed will do masks widespread disagreement over what the Fed should do. Jim Bianco, founder of Bianco Research, wrote, “The longer the Fed goes without hiking, the more its credibility is hurt.”
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.