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Monetary Policy Forecast

Our monetary policy forecast stays the same.  In short, we believe that the FED will raise more times and to a greater degree than the consensus three rate rises forecast. Thus, equity investors should take precautions since we see four…

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FED Rate and Balance Sheet Forecast

Our forecast has been for the FED to raise rates in June.  Although the economic data has been weaker as of late, we are sticking by our forecast. This is in-line with our overall view for 2017 that the FED…

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March Rate Hike and Fed Policy

The market now sees 3 rate hikes instead of 2 for for 2017.  We have had this position for some time in our previous forecasts. Regarding the pace of rate hikes, it depends on economic growth and inflation.  Surveys currently…

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FED Meeting – What to look for?

The FED meeting today is important for setting up future rate moves.  I would pay less attention to the data and more attention to the tone of the language. Regarding the risk of a hike today, it is close to…

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FED Rate Forecast for 2017

Our forecast for future rate hikes by the FED in 2017 depend on inflationary pressures arising from the new economic policies of Trump.  In general, inflation seems to be picking up, or we should say inflationary expectations are picking up.…

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FED Rate Forecast

Today the PPI (Producer Price Index) not including food and energy came in negative.   The CPI (Consumer Price Index) is the next one to look at. Irregardless inflation expectations have risen quite a bit as can be seen clearly…

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FED Rate Forecast & FMOC Minutes

The FMOC meetings confirm a divided FED.  This should be expected at turning points at times of uncertainty. Our view has always been that the November rate hike was highly unlikely for two reasons - the data was not conclusive…

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FED Outlook 2016

Our forecast for the next US Fed rate rise has been revised to account for the recent macro data.   The data has come in weaker than it should to warrant a rate rise in September.  Thus, nothing will occur in…

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FED 2016 Rate Forecast

Our forecast for FED rate hikes in 2016 was 2 hikes for 2016.  We strongly doubted the then prevailing market view of 3 to 4 hikes.  It is now clear that the maximum number of hikes will be 2 at…

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December Rate Hike – then what?

The December rate hike is now clearly going to happen.  The Fed has been spelling this out in its messages to the market.  Expectations are for a 0.25 to 0.5 hike.  In all likelihood it will be 0.25. The big…

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