1. Rate hike 50 basis points or more 2. Rate hike 25 basis points 3. Stay the same 4. Rate cut Food inflation is through the roof. I saw $6+ dollar a gallon milk at the store, saw $3.50 a slice pizza at the local restaurant, paid $4.50 for a bag of combos and a monster, saw $7.50 Burger King meal, paid $60.00 for 4 drinks, a steak sandwich and some pasta in Hoboken, etc. Gas, just look at the sign. In my mind, there is no way that the Fed will leave rates unchanged this year. Something has to give.
The Fed should hike rates and decrease money supply. It will destroy the current economy, but a stronger real economy to be reborn. CPI is the biggest joke ever! They Gummit might as well report negative CPI and use that as an excuse to cut rates.
Futures are back showing a slight chance of a cut by years end. Right now hikes are priced in with odds of 0%.
if they had any balls they would hike. likely scenario is on hold with possible rate increase hint if data continues strong.
Yes, mortgage industry will like rate hikes ;=) => Merrill to Sell $800 Million of Bonds From Bear Fund http://www.bloomberg.com/apps/news?pid=20601087&sid=amq21ivLHQeI&refer=home
I think they know that the price of gas and food is acting as a brake on the economy. People are curtailing their spending. Also think that with the housing market sputtering, they'd rather err on the side of a faster economy because they can always kill the economy if they want to, but it would be hard to jump start the housing again once they do. SM
I see warnings of a hike, feds Fisher is talking today, "Feds mission is to keep inflation at bay." I lean to a hike of .25
There will be no hike. I'd love to see one, but sadly the Fed won't move yet. That is my prediction. Try not to make what you want to happen a part of what you believe will actually happen.
Fed's Fisher: Encouraging signs on inflation -- yoy core CPI has come down to 2.2% from previous rate of 2.6% for all of 2006. Still above the 1-2% desired range but not enough to warrant an immediate hike. Past 3 months on an annualized basis the core is 1.6%.