BMO economist Jennifer Lee expects the Federal Reserve to raise interest rates at least twice before the end of the year. This forecast is consistent with current market sentiment, which anticipates tighter monetary policy to combat inflation.
The federal funds rate currently stands at 3.63%. Market participants assign a 90% probability to a rate hike during the next Federal Reserve decision, reflecting widespread expectations of continued policy tightening.
The upcoming Federal Open Market Committee meeting, scheduled for September 16, is expected to clarify the central bank's future trajectory. Observers are focused on upcoming statements from Fed officials, including Chairman Kevin Warsh and Governor Michelle Bowman.
Future monetary policy adjustments will depend on key economic indicators, specifically inflation rates and employment figures. These data points remain central to shaping market expectations regarding the pace of interest rate changes.
