Arab Today, arab today as brexit vote looms fed expected
Last Updated : GMT 12:14:16
Arab Today, arab today
Arab Today, arab today

To reject rate hike

As Brexit vote looms, Fed expected

Arab Today, arab today

Arab Today, arab today As Brexit vote looms, Fed expected

Federal Reserve Chair Janet Yellen
Washington - Arab Today

Growing economic uncertainties including the looming British vote on quitting the European Union should prevent the Federal Reserve from hiking interest rates Wednesday.

Analysts say the Fed's two-day policy meeting should wrap up with the central bankers opting to wait and see what happens when Britain votes in a referendum on Brexit next week.

That would be a relief to investors and borrowers around the world, with the benchmark federal funds rate a key determinant of financing costs in a broad range of markets.

But keeping Fed policy on hold will not likely quell the volatility that the Brexit vote has injected into markets.

According to polls, support for leaving the EU has only risen since Fed Chair Janet Yellen warned earlier this month that doing so "could have significant economic repercussions."

Yet the Brexit vote is only one of several worries that have caused officials of the Federal Open Market Committee to reverse course on plans for a midyear increase in the central bank's key short-term interest rate, now pegged at 0.25-0.50 percent.

After the Fed's late-April meeting, Yellen and others on the FOMC said that the economy appeared strong enough for them to go ahead with an increase in June or July, and some suggested further hikes later in the year.

But a strikingly bad May report on US employment, with the number of jobs created the lowest in nearly six years, surprised them.

And Yellen remains frustrated with still-weak inflation, and especially the fall in the market of inflation expectations, which could suggest that the Fed's efforts to stimulate spending and investment are failing.

Fresh data early Wednesday will support her concerns. Wholesale inflation data showed core prices -- those with volatile fuel and food stripped out -- declined 0.1 percent last month.

In addition, Fed figures showed that industrial output fell 0.4 percent in May and was down 1.4 percent year-on-year.

Together, all that will convince the Fed to keep its short-term rate unchanged, said Stuart Hoffman, chief economist at PNC Financial Services Group.

"The disappointing May employment report... and global financial market unease, much of it tied to the upcoming referendum in the United Kingdom on European Union membership, will keep the FOMC on hold," he said.

The focus from the markets will be on how optimistic or pessimistic the FOMC sounds in its statement and economic forecasts, and Yellen in her post-meeting press conference, on prospects for US growth for the rest of the year.

Many economists now expect the Fed will not move before September; Fed fund futures trading on the CME show the markets expect December at the earliest.

Hoffman though was more optimistic.

"Rates could move higher at the FOMC's late-July meeting if job growth rebounds in June as expected, financial market concerns fade, and inflation looks set to pick up," he said.

Source: AFP

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today as brexit vote looms fed expected Arab Today, arab today as brexit vote looms fed expected

 



Arab Today, arab today
Arab Today, arab today Nohan Seyam designs beautiful accessories

GMT 20:02 2017 Tuesday ,21 February

Nohan Seyam designs beautiful accessories
Arab Today, arab today Tourism shows signs of recovery

GMT 09:59 2017 Monday ,20 February

Tourism shows signs of recovery
Arab Today, arab today Sarah Belamesh designs antiques of "ceramic"

GMT 19:45 2017 Monday ,20 February

Sarah Belamesh designs antiques of "ceramic"
Arab Today, arab today Top Yemen commander killed

GMT 09:55 2017 Wednesday ,22 February

Top Yemen commander killed
Arab Today, arab today To probe sexual harassment claims

GMT 10:08 2017 Tuesday ,21 February

To probe sexual harassment claims

GMT 06:51 2017 Saturday ,18 February

Blames government for economic crisis

GMT 06:35 2017 Saturday ,18 February

MP calls for re-operating closed companies

GMT 13:35 2017 Friday ,17 February

Confirms Britain is biggest investor in Egypt

GMT 15:55 2017 Thursday ,16 February

Egyptian foods completely unobserved nor healthy

GMT 11:18 2017 Wednesday ,15 February

Reveals plan to get out of financial crisis

GMT 12:33 2017 Tuesday ,14 February

Yemeni accuses militias of challenging oil

GMT 18:07 2017 Monday ,13 February

Over 3000 workers lost their jobs
View News in Arabic - Business: أخبار الاقتصاد
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today To hold social dialogue over secondary school

GMT 07:43 2017 Wednesday ,22 February

To hold social dialogue over secondary school
Arab Today, arab today 63-Year-Old Woman Delivers Baby

GMT 12:35 2017 Tuesday ,21 February

63-Year-Old Woman Delivers Baby
Arab Today, arab today Milan laughs while Rome cries

GMT 10:28 2017 Wednesday ,22 February

Milan laughs while Rome cries
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today Nissan enhances sales in most markets

GMT 14:08 2017 Monday ,20 February

Nissan enhances sales in most markets
Arab Today, arab today Competes Sweden and Germans by S90

GMT 22:36 2017 Thursday ,16 February

Competes Sweden and Germans by S90
Arab Today, arab today Janat pleased for issuing 'Good Morning'

GMT 06:41 2017 Monday ,20 February

Janat pleased for issuing 'Good Morning'
Arab Today, arab today Small ponds have outsized impact

GMT 15:53 2017 Tuesday ,21 February

Small ponds have outsized impact

GMT 06:34 2017 Sunday ,19 February

Ahmed Fahmy stresses he did not ignore singing

GMT 06:50 2017 Wednesday ,15 February

Tragic fluctuations of Bakhtiari's life revealed

GMT 12:22 2017 Monday ,20 February

Kanye West puts hijab-wearing model

GMT 14:06 2017 Friday ,17 February

London to tax old cars

GMT 23:29 2017 Thursday ,16 February

Home built on sand castles-style costs $8m

GMT 05:15 2017 Tuesday ,21 February

Omega 3 can reduce asthma cases

GMT 19:16 2017 Friday ,17 February

Aziz House ready to host the tourists

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 12:39 2017 Monday ,20 February

newest smartphone another winner for Huawei

GMT 16:08 2017 Wednesday ,15 February

Shawsh reveals her collection "Jewelry of dreams"
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday