FOMC: Time for 25bps hike - Westpac

The research team at Westpac, expects the US Fed to raise interest rates by 25bps to 1.125% today.

Key Quotes

 “2017 has seen an acceleration in the pace of interest rate normalisation in the US. Following two years where the Committee struggled to achieve one rate hike, they are targeting three in 2016, with the second universally expected at this meeting.”

“A strong labour market and robust confidence are the prime supports for policy normalisation. Core inflation is yet to accelerate to the FOMC's 2.0%yr target, but is anticipated to occur given full employment has been attained and economic growth continues near trend.”

“The focus for the press conference will be to see if any further guidance on the timing and pace of balance sheet normalisation is offered. A decision before end-2017 is anticipated.”