ChartBrief #4 Fed Dot Plot

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ChartBrief #4 Fed Dot Plot

ChartBrief #4 Fed Dot Plot by Topdown Charts

A quick update on the equal weighted average Fed “Dot Plot” dot following the September FOMC announcement. This graph charts the average dot (i.e. an equal weighted average of all the dots on the chart) of the Fed’s own expectations of where it sees the Fed Funds Rate through time. The September 2016 projections were revised down by about 1 hike across the time frames and still imply a hike in December (albeit it could only be a 12.5bp hike!)

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Specifically the average dot came down by -17bps in 2016, -32bps in 2017, -35bps in 2018, and -23bps for the longer run expectations of the Fed funds target rate.  Perhaps the more interesting number in this Fed statement was that 3 FOMC members dissented this meeting – preferring to get on with hiking interest rates. So there is definitely a movement within the Fed looking to get on with the next rate hike, but it still seems likely that the next hike will come in December given the impact of election uncertainty on the data, and still mixed signals on the US economy.

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Topdown Charts: "chart driven macro insights" Based in Queenstown, New Zealand, Topdown Charts brings you independent research and analysis on global macro themes and trends. Topdown Charts covers multiple economies, markets, and asset classes with a distinct chart-driven focus. We are not bound by technical or fundamental dogma, and instead look to leverage any relevant factor to capture the theme. As such, here you will find some posts that are purely technical strategy, some that just cover economics and data, and some posts that use multiple inputs to tell the story and identify the opportunities. Callum Thomas Head of Research Callum is the founder of Topdown Charts. He previously worked in investment strategy and asset allocation at AMP Capital in the Multi-Asset division. Callum has a passion for global macro investing and has developed strong research and analytical expertise across economies and asset classes. Callum's approach is to utilise a blend of factors to inform the macro view.
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