Just yesterday the WSJ was pushing the 75-basis point hike…Bloomberg was still hedging that way this AM….now this article from end of day yesterday pushing for 100.
Some Wall Street traders are betting that the Federal Reserve will take the most aggressive step in decades as it races to catch up with scorching-hot inflation.
The dismal report prompted some banks, including Barclays and Jeffries, to revise their expectations for the Fed meeting this week, which concludes on Wednesday. The strategists now expect central bankers to approve a 75-basis point hike as they try to project confidence to the markets.
“The U.S. central bank now has good reason to surprise markets by hiking more aggressively than expected in June,” the Barclays strategists wrote in a note Friday. “We realize it is a close call and that it could play out in either June or July. But we are changing our forecast to call for a 75-basis point hike on June 15.”
Policymakers have not lifted the short-term interest rate by 75-basis points since 1994, and have not approved a 100-basis point increase since Paul Volcker led the central bank and ran an aggressive inflation-crushing campaign in the early 1980s.
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