Federal Reserve: Expectations of December rate hike strengthen – Commerzbank

October’s robust payroll figures and persistently elevated inflation support the case for another Federal Reserve rate rise in December, according to Commerzbank Research. With most Fed officials having already forecast at least one further increase this year, the bank considers the latest data unlikely to shift their position. Its forecast is for a further 25 basis point increase in the policy rate at the forthcoming FOMC meeting.

Robust data support expectations of December rate rise

"The report reinforces our view that the Federal Reserve will raise rates again in December because of inflation risks."

"Of the 18 Fed officials who submitted projections for the appropriate path of interest rates in September, 16 anticipated at least one more rate hike this year. The data released since then are unlikely to have changed that assessment materially."

"Following October's pause in rate hikes, attention now turns to the Federal Open Market Committee's December meeting. Today's figures reinforce our view that the Fed will raise its policy rate by another 25 basis points at that meeting."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)