Will Brexit Uncertainty Push Fed Rate Hike Back to 2018?
Circle Jan. 31, 2018, on the calendar. That’s the soonest the Federal Reserve hikes next. At least if money market derivatives are to be believed. Traders, who have consistently been better at projecting the path of interest rates than the Fed itself, are now pricing in a greater probability that policy makers will cut rates in upcoming meetings than raise them. They don’t assign more than a 50 percent chance of an increase until the beginning of 2018, and don’t price in a full rate hike until the final quarter of the year. The sea change in outlook for central bank policy comes after global equities and commodities plunged while government bonds and the dollar surged following Britain’s vote to quit the European Union. RBC Chief European Macro Strategist Peter Schaffrik discusses with Bloomberg's Anna Edwards on "Countdown."
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