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Fed to Slow 2019 Rate Hikes Amid Downside Risks, Poll Shows

  • Economist expect officials will signal two hikes next year
  • Most see Fed dropping call for ‘gradual increases’ by March
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Deutsche Bank’s Dominic Konstam explains why he sees no rate hikes from the Federal Reserve in 2019.Source: Bloomberg
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Federal Reserve officials will pull the trigger on another interest-rate increase next week before slowing the pace of hikes in 2019 as risks to the U.S. economy mount, according to a new Bloomberg survey of economists.

They expect the Fed will raise rates by a quarter percentage point at its Dec. 18-19 meeting while dialing back the number of moves next year to two, in March and September, from the three hikes economists saw in September. Median responses in the Dec. 7-11 poll also anticipate one additional hike in mid-2020 when the rate would peak in this tightening cycle at a target range of 3 percent to 3.25 percent.