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Fed Dearler Survey Projects Rate Increase in 2015

Primary dealers saw the Federal Reserve raising its benchmark interest rate in the second half of 2015 in a survey conducted by the central bank before the Sept. 12-13 policy meeting.

The median respondent in the survey by the Federal Reserve Bank of New York saw the central bank increasing interest rates in the third quarter of 2015, up from the first quarter of 2015 in the survey conducted before the Federal Open Market Committee’s July 31-Aug. 1 meeting.

Fed officials extended their horizon for low interest rates through at least the middle of 2015 in a statement after their meeting in Washington. They also announced a third round of asset purchases, saying they’d buy $40 billion of mortgage- backed securities each month.

Bond dealers saw a 65 percent chance the Fed would expand its balance sheet through securities purchases at that FOMC meeting, according to the median response from results updated on Sept. 11. They also saw 80 percent odds the FOMC would change its forward guidance on the path of interest rates.

After the last FOMC meeting, the Fed asked primary dealers to update their expectations for the size of the central bank’s portfolio and reserves balances.

To contact the reporter on this story: Caroline Salas Gage in New York at

To contact the editor responsible for this story: Christopher Wellisz at

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