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ABN AMRO Now Sees 50bp Hike In July

FED

Following Chair Powell's forward guidance at the May FOMC press conference, ABN Amro now sees 50bp hikes in both June and July, having previously seen a 25bp pace re-commencing in July. Despite the slightly more front-loaded schedule, their terminal rate expectations remain 2.50-2.75%.

  • "Powell emphasised the role of financial conditions in guiding this, stating that conditions 'tightening appropriately' would signal to the Fed that it is at or moving beyond neutral levels. This is consistent with our view that a further tightening in conditions will likely be necessary for the Fed to feel it is doing enough to tighten policy."

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