Posted on 12/16/2015 11:06:23 AM PST by Zeneta
The implications surrounding the Feds decision are wide reaching.
The reaction to this announcement will be almost instant in some markets.
http://www.forexfactory.com/market.php
Watch this !!
The did already. Fed Funds increased .25%. Non story at this point
I’m thinking it’s time for rates to go up. God help us if they go negative.
Market just took off, up 120 in last hour.
The markets have had time to factor this in. Any reaction is market timers trying to take advantage of short term swings.
This could get strange quickly...
Consumers are still getting scr****.
Distraction Time
The pre-announcement Eur/USD volatility is insane.
Banks have lots of cash from investors afraid of market. CD rates not likely to increase.
** FED RAISES INTEREST RATES 0.25 POINT IN UNANIMOUS VOTE
— SEES CONDITIONS WARRANTING `ONLY GRADUAL’ RATE INCREASES<— Dovish
— FORECASTS SIGNAL SAME 2016 RATE RISE PACE AS SEPT. OUTLOOK
— MEDIAN FED FUNDS RATE 2.4% END-2017 VS 2.6% SEPT. EST.
— MEDIAN FED FUNDS RATE 1.4% END-2016, UNCH VS SEPT. EST.
— MEDIAN 2016 PCE INFLATION OUTLOOK 1.6% VS 1.7% IN SEPT EST
— PCE INFLATION REACHES 2% GOAL IN 2018
— MEDIAN 2016 GDP GROWTH FORECAST 2.4% VS 2.3% IN SEPT EST.
— REINVESTMENT STAYS UNTIL NORMALIZATION `WELL UNDER WAY’
— statement change, “survey-based of longer-term inflation expectations have edged down.”
** As we rapidly look over all this we see little that should be a surprise; they hiked, we know why, and they’ll be gradual and data dependent. The slight, very slight, diminishment in distant dots and note on market measures of inflation expectations is perhaps slightly dovish but we’d make no big deal about it.
** Well, the market seems to generally concur — yields are a bit higher with long end outperforming, 2s up against 1%. As we wrote if this is the knee-jerk response it’s hardly much. For what it’s worth June Fed Fund Futures were 52 bp before and remain at 52 bp.
Suspect the taxpayers are going to feel this as government(local thru federal) borrowing costs are now going to increase........
Just received two emails today from my bank wanting to loan my business money to expand. Thanks but no thanks!
IMHO, the Fed’s will raise rates and it will set the US apart from the rest of the Central Bankers around the world.
The US Dollar will rally in a huge way.
Rumor going around info was leaked. Might explain the drastic dump of gold before announcement
Eur/USD at 1.0950
It will go much much lower
The bottom is about to drop out on the EUR/USD pair.
If they go negative, I’ll borrow a couple hundred billion dollars and keep it for a year or two.
I’m sorry to tell you that in a “Decreasing rate” environment you should be a lender, not a borrower.
In an increasing rate environment is when you would want to borrow, in order to lock in a lower cost of funds.
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