Surprise Surprise, Rate Hike Odds Surge - Forex News by FX Leaders

Surprise Surprise, Rate Hike Odds Surge

Posted Friday, October 28, 2016 by
Skerdian Meta • 1 min read

OK, the US Q3 GDP headline was great. Exceeding expectations by 0 4% is not something to go buy unnoticed. It's more than double the previous quarter and the annualized GDP number ticked 2 points higher to 1.7% from 1.5%. 

FED rate hike odds right now stand nearly 5 points higher than they were prior to the GDP report. As we said in the previous update, the market got excited by the headline number and rate hike odds for December surged to above 80%. That's a massive jump from the low 70s, isn't it? Anything higher than that and the FED would better announce the interest rate hike right now rather than leaving it for December. 

But the GDP report wasn't all good and we know there's no such thing as a sure bet in forex, in finance or in life for that matter. In fact, I heard some rumours around that the FED won't repeat last year's speech in next week's meeting. I don't know how many of you remember last November when they made sure to stick it to our skulls that the FED would definitely hike rates in the following month. 

The rumours say that this time the FED won't even mention the phrase "Next month", in connection to their monetary policy. They don't want to put themselves in a corner where they can't get out of. They want to leave the escape door open just in case the world falls apart, this way they won't be forced to eat their words yet another time. There is always that odd probability that Trump wins the US presidential elections, you know? Sorry Republicans. 

 

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies

About the author

Skerdian Meta // Lead Analyst
Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
Related Articles
Comments
0 0 vote
Article Rating
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments