The Traderszone Network

Published in TZ Latest News 16 December, 2015 by The TZ Newswire Staff

Unchanged 2016 Fed Funds Median "Dot" Signals Fed Expects 4 Rate Hikes In 2016

There was much expectation that the Fed’s announcement would be a Dovish hike based on a reduction in the 2016 median dot, however the Fed did not do that, and instead while the Kocherlakota negative dot was removed, the FOMC kept the median 2016 fed funds rate at 1.4% for year end, suggesting 4 rate hikes during 2016 and that the market is underestimating the pace of rate increases.

Where there was some dovishness was in the 2017 year end median FF, which was reduced from 2.6% to 2.4%. This can be seen in the compared dot plots.

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