The adverse market reaction to the slightly more hawkish tone of comments from the Fed yesterday looks justified to us. Indeed, market expectations for US interest rates are likely to rise further, putting additional upward pressure on Treasury yields and undermining equities, while supporting the dollar. Nonetheless, the Fed is still likely to move only gradually, so we are not anticipating major falls in the prices of riskier assets, including emerging markets and commodities.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services