Highly Likely, Not a Foregone Conclusion

Economic Research	3 November 2016
UNITED STATES
Economic Highlights
Highly Likely, Not a Foregone Conclusion With less than a week before Election Day, the November Federal Open Market Committee (FOMC) meeting, unsurprisingly, concluded with limited fanfare. Aside from the routine updates in the current assessment section, the most conspicuous nudge in the post-meeting statement was the recognition that the conditions for a rate hike have “continued to strengthen” and that the FOMC is merely awaiting “some” additional progress between now and the December meeting. While the FOMC refrained from reintroducing the reference “at its next meeting” (which was in the October 2015 statement prior to the December liftoff) in the latest statement, perhaps for flexibility reasons and/or to avoid drifting toward calendar-based guidance, the preceding inclusion arguably lowers the bar further for an increase at the subsequent meeting in six weeks. Overall, this is consistent with our ongoing call for the FOMC to raise rates by 25bps at the December 13-14 meeting (for different angles and relevant discussions surrounding the prospect of a December hike, kindly refer to our routine publications since early July). Economist:  Thomas Lam  | +65 6533 0389
To access our recent reports please click on the links below: 01 Nov: More Questions than Answers… 11 Oct: “Let’s Get Ready to Rumble”: Trump vs. Clinton 04 Oct: Reviewing & Previewing Our Forecasts 22 Sep: Dots & Tone 21 Sep: Awkward but New 19 Sep: FOMC Preview: September 20-21 Meeting