And BMO's Lyngen said on debt......>

US TSYS/RESEARCH: And BMO's Lyngen said on debt limit/govt shutdown prospect,

that "timing of the shutdown risk becomes a bit more challenging to narrow down.

And while the magnitude of any market impact of a partial closure into year-end

might differ from that of one occurring in the 1Q, we maintain that the

prospects are not going to derail the FOMC's plan to hike rates later this

month. In fact, the futures market is currently pricing in 24 bp of tightening

by year-end, implying a 96% probability that Yellen's last act as Fed Chair will

be to deliver the fifth hike of the tightening campaign." 

- He added that assuming "the Fed's 2.9% terminal rate holds (admittedly, a big

assumption), that means that after Dec. 13th, the FOMC will be roughly half way

through its tightening cycle." He adds "frankly, 2017 marked the first year that

the beloved dot-plot got it right. The Fed promised 3 rate hikes and balance

sheet tapering and that looks to be exactly what will be provided. What we find

so instructive about the Fed's behavior in this particular stage of the policy

cycle is that the tightening was undertaken despite the conspicuous absence of

inflation."