Fed: 25bps hike is almost fully discounted – RBC CM

In view of analysts at RBC Capital Markets, a 25bps hike to 1.00–1.25% is almost fully discounted this week when the Fed meets.

Key Quotes

“More important will be Chair Yellen’s press conference for a bit more detail on balance sheet run-off. It is probably too early to get the initial sizes of the caps, but we may get more on the likely evolution of these. We simply view the caps as a flexible tapering. Tapering would have been very hard to adjust once it was announced, while caps can be far more data-dependent.”