U.S. and Global Market Turmoil Causes Forecasters to Fed’s next move up

U.S. and Global Market Turmoil Causes Forecasters to Fed's next move upGold Silver Reports → Economists are pushing back their calls for the next Federal↔Reserve interest↔rate hike in droves. Trouble overseas and uncertain economic conditions at home have helped move the median forecast to June from March.

Nearly 68 percent of economists say the Fed will next raise rates in June, analysis of 53 firms that contribute forecasts. That compares with 30 percent in January, when a majority estimated the next increase would come at the March meeting.

“Forget about March, forget about June,” said Brett Ryan, a U.S. economist at Deutsche Bank in New York. Delivering semiannual testimony to Congress on Thursday, Chair Janet Yellen “made it clear that it’s going to take some time for the Fed to be comfortable that this most recent bout of volatility isn’t going to materially impact the economy,” he said.

Standard Chartered Bank—which previously called for one rate hike in March followed by a cut in December↔has removed its rate rise forecast entirely.

While “a lot has happened” since the Fed in December raised its benchmark federal funds rate for the first time in nearly a decade, Yellen told the Senate Banking Committee that she hasn’t yet seen enough of a downturn to prompt the central bank to cut interest rates. Fed officials have said that economicdata will guide future decisions.

Growth in the U.S. decelerated to a 0.7 percent annualized rate last quarter, as companies struggle with a slower global economy, the negative effect on exports from a stronger dollar and plunging oil prices that are pushing some firms to cut investment. The manufacturingsector has struggled for months, and data indicate the softness may be spreading to services industries, which make up about 90 percent of the economy.

“Weakness in the manufacturingsector often spills over into the servicessector,” Deutsche Bank’s Ryan said. Rate calls are being pushed back due to “a combination of a growing list of international concerns set to the backdrop of a U.S. fundamental picture that’s really only standing on one leg, and that’s the consumer.” ~ Neal Bhai Reports

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Neal Bhai has been involved in the Bullion and Metals markets since 1998 – he has experience in many areas of the market from researching to trading and has worked in Delhi, India. Mobile No. - 9899900589 and 9582247600

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