Most Expect a 2016 Fed Rate Hike, Raymond James' Giddis Tells Bloomberg

Raymond James Executive VP Kevin Giddis estimated that every economist, investor believes there will be at least one Federal Reserve rate increase by the end of 2016 on Bloomberg today.
By Lindsay Rittenhouse ,

NEW YORK (TheStreet) -- A poll from Bloomberg out Thursday shows that more investors think a Federal Reserve rate increase will happen within the year, than they did last Wednesday, Scarlet Fu reported on "Bloomberg Markets" Thursday.

Investors think there is a 44% chance that the Fed will implement an interest rate hike at its December meeting, a 34% chance for March and a 50% odd in the months after March. This compares to last Wednesday's poll that showed investors thought there was a 28% likelihood of an interest rate increase in December, a 34% chance in March and "you really (did not) see anything above 50% through September of 2017," according to Fu.

"It's tricky to predict," Raymond James Executive VP Kevin Giddis told Fu.

"In fact the further you go out on each Fed meeting, the margin for (a rate increase) increases quite a bit so what we do know is the Fed is likely to not do anything next week (at its July meeting)," Giddis said.

The probability of a rate increase after July, on the other hand, becomes "a guessing game," he noted.

"We're not even at 50% in all of 2016 although if you pin most economists down and even major players in the bond market, they're going to tell you that there is at least one rate hike with the Fed in 2016," Giddis estimated.

However, this prediction can change depending on global events, he added.

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