FOMC Preview: Rates on hold, significant decline in rate projections – Nomura

By FXStreet FXStreet (Delhi) – Research team at Nomura, do not expect the FOMC to raise rates this week as uncertainty about the outlook for inflation remains material and the selloff in global financial markets over the last six weeks has raised new downside risks.

Key Quotes

“The economic forecasts for this year are likely to change in response to data that have already been released. We are not expecting big changes to the economic forecasts for 2016 and beyond.

“More importantly, we will also get another set of interest rate forecasts. We are expecting significant declines in the FOMC’s expected path of interest rates. At a minimum, we expect the Committee’s forecast for 2015 to coalesce on one hike this year.”

“We do not expect the Committee to endorse a more rapid pace of interest rate adjustment after liftoff. Consequently, the delay in liftoff should imply a lower path of rates over the whole forecast horizon.”
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Source:: FX Street