Major Wall Street Banks See Fed Rate Hike in September, Further Increase Possible This Year
Summary
- A report said most major Wall Street banks expect the Federal Reserve to raise its benchmark interest rate in September.
- It said most banks expect the total rate increases this year to be 50 basis points, while some forecast 75 basis points of increases.
- Markets are increasingly focused not only on this week's rate hike but also on the possibility of additional Fed tightening before year-end.
Forecast Trend Report by Period
Most major Wall Street banks expect the Federal Reserve to raise its benchmark interest rate in September. Markets are focused not only on this week's move, but also on whether the Fed will tighten further before year-end.
Walter Bloomberg, citing a Wall Street Journal survey on September 15, reported that nearly all major Wall Street banks expect the Fed to raise rates in September.
Most banks forecast total rate increases of 50 basis points this year. Bank of America, Deutsche Bank and RBC expect cumulative increases of 75 basis points. One basis point equals 0.01 percentage point.
That has intensified market focus on whether the Fed could raise its benchmark rate again before the end of the year, beyond any move this week.
JH Kim
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