Will the Fed Raise Rates in March?
Upcoming inflation, consumption, auto, and employment reports will be key factors in the decision.
Recently released U.S. Federal Reserve minutes and a number of more hawkish-sounding Fed speakers raised the prospects of more rate increases in 2017, perhaps beginning as early as the Fed's March 15 meeting. Before this week, the probability of a Fed rate increase in March was nil. By the close of the week, the probability was a much higher 22%.
The minutes suggested that the Fed would be raising rates "fairly soon." Since then inflation and employment both checked in higher than expected. This week one governor suggested that a rate increase was on the table in March, a sentiment echoed by another Fed governor earlier in the week.
Robert Johnson, CFA does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.