12 Jun 2015
Fed hike not until year end - Rabobank
FXStreet (Guatemala) - Analysts at Rabobank are sticking to the call for the Fed to hike in final quarter of 2015.
Key Quotes:
"While market expectations about the first rate hike have changed dramatically in the last week or so, we stick to our Q4 call for now. Some factors that led to negative GDP growth in Q1 are no longer holding back GDP growth: the extreme winter, port strikes on the West Coast and the BEA’s problems with seasonal adjustment of the GDP series. Therefore, we were not too concerned about the slow start of the year and a while ago we resisted the temptation to shift our forecast for the first rate hike to 2016."
"However, other ‘transitory’ factors are still playing a role, and this makes us doubtful of a September hike. The strong dollar remains a headwind for US exporters, and the low oil price has reduced the incentives to invest in the energy sector."
"Consumers are still hesitant to spend their windfall gains from cheaper energy."
"We expect only a modest re-acceleration of the US economy in Q2, which should delay the Fed’s first rate hike to the final quarter of the year."
Key Quotes:
"While market expectations about the first rate hike have changed dramatically in the last week or so, we stick to our Q4 call for now. Some factors that led to negative GDP growth in Q1 are no longer holding back GDP growth: the extreme winter, port strikes on the West Coast and the BEA’s problems with seasonal adjustment of the GDP series. Therefore, we were not too concerned about the slow start of the year and a while ago we resisted the temptation to shift our forecast for the first rate hike to 2016."
"However, other ‘transitory’ factors are still playing a role, and this makes us doubtful of a September hike. The strong dollar remains a headwind for US exporters, and the low oil price has reduced the incentives to invest in the energy sector."
"Consumers are still hesitant to spend their windfall gains from cheaper energy."
"We expect only a modest re-acceleration of the US economy in Q2, which should delay the Fed’s first rate hike to the final quarter of the year."