While we sit back and wait, examining chicken entrails & tea leaves, Janet Yellen faces "a leadership test as she presides over a hugely contentious decision on Thursday, amid clashing data and heavy lobbying from across the globe"
That's the take in a front-page article from the Financial Times on Monday
It touches on what Bill Evans (chief economist at Westpac) said, that no hike in Septemeber could create a destabilising period of uncertainty. Evans also added that delaying the hike until December places "a major policy change into a time of limited market liquidity".
The FT also makes the points:
- Divisions still within the FOMC (and amongst traders & economists/analysts)
- The Fed has not clearly laid the groundwork for a move in September ... with the FT making the point that
The situation contrasts with the run-up to the last two periods of rising US interest rates. The Fed's first rate increase in 2004 was almost completely priced in two weeks ahead of its meeting, as it was in 1999, according to George Goncalves, head of US rates strategy at Nomura.
The Financial Times (gated, but can be read with a free registration) article has more: Fed guidance splits markets over rate rise
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Over the weekend ForexLive kicked off with a couple of FOMC previews, and we'll have more in the lead up to the announcement on the 17th.
- Goldman Sachs previews the Federal Reserve decision on Sept 17
- Westpac chief economist says expects the Fed to hike next week
