Free Trial

BMO Now Sees Five 2022 Hikes, Sees Risk Of Even Quicker Rises


BMO has joined the growing number of analysts looking for 5 25bp Fed funds hikes this year, and see risks very much to the upside.

  • indeed, "one got the sense that the Fed could have easily raised policy rates [at last week's FOMC meeting]...if not for the formality of having to proffer forward guidance first and the technicality of having to wind down asset purchases beforehand".
  • BMO now sees the Fed starting the hiking cycle with 3 consecutive increases in March, May and June, "and, yes, during this initial flurry, a 50-pointer is a distinct possibility" -before shifting into quarterly hikes, meaning 5 hikes total this year (previously 4), with a terminal rate of 2.375%.
  • And "the net risk lies on the side of an even quicker rate hike cadence to an even higher ending level. And, this net risk is large."
  • BMO now sees QT starting in July (was October previously).

To read the full story



MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.