Capital Economics said it is “almost certain” the U.S. Federal Reserve will keep policy unchanged this week. According to ChainCatcher, the view was cited from a Jin10 report.
Stephen Brown, Capital Economics’ chief North America economist, said the market risk centers on potential communication errors or a shift in Kevin Warsh’s stance, adding Warsh’s remarks could be more hawkish than expected.
Brown also said that if Warsh is constrained by U.S. President Donald Trump, a dovish tone could raise concerns about the Fed’s independence and push up long-term bond yields.
He added that the likelihood is high for two “insurance” rate hikes in December and early next year.