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Why MNI
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.
FED
All but three sell-side bank analysts expect the Fed to hike by 75bp at the July meeting, per the 27 notes we read for our July FOMC preview.
- Four sell-side analysts forecast a 100bp hike following the June CPI data in mid-July: Citi, Nomura, Societe Generale and Wells Fargo.
- We haven’t seen updated notes for the first two; of the latter two, SocGen has since reverted to 75bp and Wells Fargo notes significant risks of a 75bp vs 100bp raise.
- No analyst expects any changes to Fed balance sheet policy at the July meeting.
- Consensus is firmly for a downshift in hike size at the Sept meeting to 50bp. A couple of analysts stand out: Wells Fargo and SEB for example looking for another 75bp in Sept, and Nomura seeing a large drop from 100bp in July to 50bp in Sept.
- Most see the rate hike cycle peaking/concluding in December. Some see earlier (Standard Chartered, Sept), while a handful see later (Feb/March).
- The expected terminal rate varies from 2.75-3.00% (ie 125bp in further hikes including July) to 4.00-4.25% (250bp in further hikes), with analysts most between 175 and 225bp more hikes.
- Several analysts are looking to recession in 2023 leading to rate cuts.
Source: MNI, Sell-Side Analyst Notes
Why MNI
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.
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