Morgan Stanley Expects Fed to Hike in March

Morgan Stanley economists said on Thursday they expected the Federal Reserve will raise U.S. interest rates by a quarter point to a range of 0.75-1.00 percent at its upcoming policy meeting in less than two weeks.

The U.S. central bank would increase its interest rate target range two more times later in 2017 after a possible hike later this month, they said in a research note.

They forecast four rate hikes in 2018.

The economists’ latest view on a March rate increase followed remarks from New York Fed President William Dudley who said on CNN on Tuesday that the case for a rate hike has become “a lot more compelling.”

This notion from Dudley, one of the most influential U.S. central bankers, has been echoed by a number of Fed officials in the past 48 hours.

On Thursday, Fed Governor Jerome Powell told CNBC the case for a March rate increase has come together with domestic inflation nearing the Fed’s 2 percent goal.

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza