The Fed still sees another hike in 2017, perhaps proving that they are in fact leaning in the direction of looking through subdued inflation in the interest of safeguarding financial stability.
As Bloomberg notes, “Fed fund futures indicate odds of an additional rate hike by year-end have increased as the central bank kept its 2017 median fed funds forecast unchanged at 1.375%, implying that it still has room for one more rate hike.”
The odds of December hike are currently ~60% from about 50% before the FOMC decision.
The reaction is immediate with yields and the dollar up…
…stocks lower and gold dipping…
