FOMC Decision Preview: Biggest Rate Hike Since 1994 On Deck

Submitted By Newsquawk

Up Until Monday afternoon, the FOMC was been expected to hike rates by 50bps to 1.25-1.50% until the hot May CPI figures, rising consumer inflation expectations and a WSJ article, ignited a wave of 75bps calls to 1.50-1.75%. The Fed guidance initially called for 50bps (both in June and July) had the data evolved as they expected, but after the hot May data, some calls for larger hikes, a 'Volcker moment', fuelled speculative market activity leading into the meeting, and given a slew of publications with high-placed sources (WSJ, CNBC, Bloomberg) have come out suggesting a 75bps hike - the biggest hike since 1994 - is indeed possible on the eve of the confab, it is now seen as a base case for many...

• Barclays +75bps
• Deutsche Bank +75bps
• CapEcon +75bps
• Goldman +75bps
• JPMorgan +75bps
• Jefferies +75bps
• Nomura +75bps
• SocGen +75bps
• TD +75bps
• Wells +75bps
• BNP +50bps
• BofA +50bps
• Citi +50bps
• Credit Suisse +50bps
• HSBC +50bps
• Morgan Stanley +50bps
• StanChart +50bps