Bond Traders Look to 2018 as This Week's Fed Raise Seen as Done Deal
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With a Federal Reserve rate hike this week seen as a done deal, the best chance for bond-market volatility may lie in policy makers’ updated outlook for the pace of future tightening.
The central bank signaled in September that it expected three rate increases in 2018, as seen in what’s known as the dot plot, officials’ quarterly outlook for the path of policy. Given strengthening economic activity, policy makers should raise estimates for growth and anticipate lower unemployment -- leaving roughly even odds that officials’ forecasts will coalesce around four 2018 hikes, according to JPMorgan Chase & Co.