Why the Bank of England is now more upbeat than the IMF 
The Federal Reserve and the art of navigating a soft landing ... when economic data sends mixed signals 
Why central banks are too powerful and have created our inflation crisis 
FxWirePro: Daily Commodity Tracker - 21st March, 2022 
Sure, the RBA froze interest rates on Tuesday, but there's plenty of pain to come 
Bank of England interest rate rise: why this could be the last increase for a while 
If central banks don't start cutting them soon, it could actually increase inflation 
Hike probability sharply spiked after last FOMC meeting, where projection material showed that the U.S. Federal Reserve is still projecting one more hike for 2017, which is likely to be December. Before the meeting, the market was pricing no more hikes until the first half of 2018. Let’s take a look at the latest hike odds for the next 12 months. (Note, all calculations are based on data as of 2nd October)
- November 1st meeting: Market is attaching 98.5 percent probability that rates will be at 1.00-1.25 percent, and 1.5 percent probability that rates will be at 1.25-1.50 percent.
- December 13th meeting: Market is attaching 17.1 percent probability that rates will be at 1.00-1.25 percent, 81.7 percent probability that rates will be at 1.25-1.50 percent, and 1.2 percent probability that rates will be at 1.50-1.75 percent.
- January 2018 meeting: Market is attaching 16.5 percent probability that rates will be at 1.00-1.25 percent, 79.7 percent probability that rates will be at 1.25-1.50 percent, and 3.7 percent probability that rates will be at 1.50-1.75 percent.
- March 2018 meeting: Market is attaching 12.3 percent probability that rates will be at 1.00-1.25 percent, 63.7 percent probability that rates will be at 1.25-1.50 percent, 23 percent probability that rates will be at 1.50-1.75 percent, and 1 percent probability that rates will be at 1.75-2.00 percent.
- May 2018 meeting: Market is attaching 11.8 percent probability that rates will be at 1.00-1.25 percent, 61.5 percent probability that rates will be at 1.25-1.50 percent, 24.7 percent probability that rates will be at 1.50-1.75 percent, and 1.9 percent probability that rates will be at 1.75-2.00 percent.
- June 2018 meeting: Market is attaching 9.5 percent probability that rates will be at 1.00-1.25 percent, 42.6 percent probability that rates will be at 1.25-1.50 percent, 36.7 percent probability that rates will be at 1.50-1.75 percent, 10.3 percent probability that rates will be at 1.75-2.00 percent, and 0.8 percent probability that rates will be at 2.00-2.25 percent.
- August 2018 meeting: Market is attaching 9.3 percent probability that rates will be at 1.00-1.25 percent, 41.9 percent probability that rates will be at 1.25-1.50 percent, 36.9 percent probability that rates will be at 1.50-1.75 percent, 10.9 percent probability that rates will be at 1.75-2.00 percent, and 1 percent probability that rates will be at 2.00-2.25 percent.
- September 2018 meeting: Market is attaching 6.3 percent probability that rates will be at 1.00-1.25 percent, 31.3 percent probability that rates will be at 1.25-1.50 percent, 38.5 percent probability that rates will be at 1.50-1.75 percent, 19.3 percent probability that rates will be at 1.75-2.00 percent, 4.2 percent probability that rates will be at 2.00-2.25 percent, and 0.3 percent probability that rates will be at 2.25-2.50 percent.
The probability is suggesting,
- Hike odds have increased sharply, especially for December by more than 20 percent as FOMC maintained its outlook for a third hike this year.
- It is, however, important to note that the market is not pricing any hike for the first half of 2018. After December, the market is pricing next hike in September 2018 with 62.3 percent probability.
