It appears bad news is bad news again. Fed's Evans just played "bad cop" to any hopeful talking head (Fed's Dudley earlier predicted US rate hike this year), implicitly taking October off the table...
- *EVANS: POL SHLD BE SOMEWHAT MORE ACCOMMOD THAN SEP SUGGESTS
- *EVANS: APPROPRIATE FOR FED RATES TO STILL BE SUB-1% AT END-2016
- *EVANS SAYS SLOWER GROWTH IN CHINA AMONG RISKS TO U.S. INFLATION
The market's reaction to this "way lower for longer" comment was negative.
So once again the market has no idea who to listen to and The Fed's communication strategy is entirely FUBAR.
Rate-Hike odds have dropped with January now back below 50%... (note Dec 2016 odds show 17.2% chance that FF >1%)
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