Poll: Will the US Federal Reserve Hike Interest Rates as Planned?

When will the US economy be strong enough for the US Federal Reserve to start increasing interest rates? Janet Yellen, head of the central bank, recently commented that US employment has been “improving on many dimensions,” laying the groundwork for a potential hike in rates.

Peter Schiff recently wrote an article describing how the market is now fixated on the Fed’s use of the word “patient” and whether the Fed will drop that word from its statements about Fed policy, signaling that it might raise rates soon. The market hangs on every word.

According to a recent Fox Business article, Fed funds futures are implying a 40-bps increase by year-end 2015, with a 60% chance of a 50-bps hike. Given the potential impact on markets of a material change in US monetary policy, we asked CFA Institute Financial NewsBrief readers whether the Fed might go through with its proposed rate hike. Of the 873 respondents, 58% believe that we will see a rate hike soon, whereas only 33% believe that the Fed will maintain its zero interest-rate policy (ZIRP). The remaining 9% are undecided.

Will the US Federal Reserve hike interest rates as planned?

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All posts are the opinion of the author. As such, they should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute or the author’s employer.