Monday, August 08, 2016

El-Erian Warns Bond Traders Not 
To Count Out September Federal Reserve Hike
Mohamed El-Erian*, chief economic adviser at Allianz, warns that bond traders underestimate the likelihood that the Federal Reserve will raise interest rates in September after a surge in U.S. hiring bolstered the case for tighter monetary policy .. "He has a point. The Fed is very short-term data driven when it comes to monetary policy and the jobs numbers that they look at are currently very strong. A September rate hike is certainly in play, though, a stock market dip or new numbers out between now and the September 20-21 FOMC policy meeting could somehow spook the Fed and delay a hike. That said the possibility the Fed is going to cut rates in September is near zero, Remarkably, though, I still see some Austrian-lites claim that the Fed is stuck and will have to cut rates soon. Not going to happen."
LINK HERE to the article

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