Wall Street banks see Fed on track to raise rates in September

11 May 2015 04:28 am - 0 - {{hitsCtrl.values.hits}}

A A A

REUTERS: Wall Street’s top banks expect the Federal Reserve to begin raising interest rates in September, with two rate hikes before the end of the year, after a U.S. jobs report on Friday showed signs of underlying strength in the economy.
All but two of the 18 firms that responded to Reuters said they expect the Fed will raise interest rates more than once in 2015. Two participants said they expect the Fed to begin raising rates in December.
The poll showed a general consensus for the federal funds rate to be at 0.625 percent at year end, and between 1.25 to 2.25 at the end of 2016.
The majority of economists at top banks polled by Reuters on Friday said their conviction around a September rate hike has stayed the same, with one noting an increase in the likelihood that the central bank would begin its so-called liftoff this fall.
The results come after a U.S. employment report showed job growth rebounded last month and the unemployment rate dropped to a near seven-year low. While the data suggested a pick-up in economic momentum at the start of the second quarter, March payrolls were also revised downward and wage growth was tepid.
“It’s about as good as it’s expected but not as good as one had hoped,” said Tom Simons, money market strategist at Jefferies & Co in New York. “It’s good that payroll growth rebounded and the jobless rate is falling. It’s more important to see April to be strong than March.”
Jefferies and Morgan Stanley were the two firms that said the Fed will begin raising rates in December. Three others did not respond to the Reuters survey.
The poll results are in line with the general consensus of top economists polled in mid-March, during which time the majority of the group said they see the Fed beginning its rate hike in September.
It marks a shift from early March, when 9 of 16 dealers polled expected a rate hike in June.
“We feel today’s report is neutral with respect to our call for September liftoff,” JPMorgan analysts said in a note published Friday, referring to the U.S. jobs data. “On the more dovish side, the soft wage number should limit any sense of urgency to move at the June or July meeting. On the less dovish side, this morning we saw continued progress in reducing labor market slack.”
In the March poll, 17 of 21 U.S. primary dealers that do business directly with the Fed expected a rate liftoff in September or later. Just four of those responding to a Reuters poll stuck with June as their forecast.

Order Gifts and Flowers to Sri Lanka. See Kapruka's top selling online shopping categories such as Toys, Grocery, Kids Toys, Birthday Cakes, Fruits, Chocolates, Clothing and Electronics. Also see Kapruka's unique online services such as Money Remittence,Astrology, Courier/Delivery, Medicine Delivery and over 700 top brands. Also get products from Amazon & Ebay via Kapruka Gloabal Shop into Sri Lanka

Comments - 0

Add comment
Comments will be edited (grammar, spelling and slang) and authorized at the discretion of Daily Mirror online. The website also has the right not to publish selected comments.

Wall Street banks see Fed on track to raise rates in September

Comments - 0

Add comment

RECOMMENDED

‘Spike in blast fishing’ poses renewed threats to Sri Lanka’s marine ecosystems

UDA owned land in Thalawathugoda; UDA Minister Prasanna Ranatunga under the spotlight for forceful occupation of reserved land

Loss-making SMIB faces political pressure in recovering loans

Baltimore Bridge Collapse: MV Dali, SL authorities anchored in mystery?

Has Sri Lanka become a potential hub for the illegal wildlife trade?

Spotlight on Moragahakanda Development Project Moragolla villagers lose livelihoods and down to one meal a day

Ambitious Sri Lankan jobseekers ‘trafficked into Ukraine war zones’

Most Viewed in News

Man who jumped off Sri Pada Uda Maluwa and went missing, found

SL on alert on possible genocide allegations by Canada

Complaint lodged over Piumi Hansamali's possession of Gota’s Range Rover

Racing event tragedy leaves seven dead including eight-year-old child

Uma Oya Development Project inaugurated

Sri Lanka weighs Open Skies amidst plans for national carrier privatization

MIRROR CRICKET

Sahan Arachchige to lead Sri Lanka ‘A’

Is Chamari Athapaththu Sri Lanka’s greatest cricketer ever?

Athapaththu back atop ICC Women’s ODI Batting Rankings

Chamari Athapaththu sets big goal for T20 World Cup

TODAY'S HEADLINES

Sri Lanka to establish new energy sector regulator

Cabinet nod to transfer China-built Mattala airport’s management to Indian, Russian joint venture

Sajith never attends dinners hosted by Ranil Wickremesinghe

One soldier dead, nine injured in road crash

Sahan Arachchige to lead Sri Lanka ‘A’

Dates confirmed for 78th Bradby Shield

SLAS appoints independent committee for investigation

Pakistan lose key players for last two T20Is against New Zealand