Most enterprise business economists polled by the National Associated of Business Economists expect the Federal Reserve to raise interests rates in the second half of the year, but they indicated that a lack of certainty regarding the Fed’s plans is no longer slowing down the recovery of the United States economy.
In the survey, 71 percent of the 293 economists polled by the NABE conveyed their expectations for the Federal Open Market Committee to increase the federal funds target rate in the second half of 2015.
The rate, which determines the rate at which banks lend funds to one another overnight, has been close to zero since late 2008.
Seventy-three percent of the surveyed economists said that the Fed should retain its 2 percent inflation target.
In an AP report published via ABC News, Wells Fargo’s chief economist John Silvia was quoted as having said that nearly “half the respondents believe current fiscal policy to be about right”.
Federal Reserve Chair Janet Yellen indicated that the federal government continues to exercise patience and that a rate hike prior to June is unlikely. She indicated that employment situation in the United States is improving, but “too many Americans remain unemployed or underemployed, wage growth is still sluggish and inflation remains well below our longer-run objective.”
Christopher Craddock, CEO at commodities trader CC Trading Co. was quoted by the NY Post as having told the news organization that the “heavily leveraged will get clocked” and “major liquidations will occur that will create temporary pullbacks in the overall market,” having a momentary affect on all markets.
Anyone who is heavily leveraged will get clocked. And major liquidations will occur that will create temporary pullbacks in the overall market […] All markets will be affected momentarily, from lumber to treasurys
The New York Post report also indicated that trading fears are currently rising more quickly than the Fed can hike up the interest rates.
Craddock went on to say that traders who have never had to borrow at 5 percent federal funding rates “are going to get a wake-up call” when the Fed, regardless of how slowly, hikes up the rates, as “the only move in rates from here is up”.
In other business coverage here on Immortal News, AT&T is losing its spot on the Dow 30 as Apple joins the Dow Jones Industrial Average.