Arguments for Fed Delay Getting Thinner and Thinner on the Ground

Reaction comments from Brian Coulton, Chief Economist at Fitch Ratings.

12 October 2016 FOMC minutes:

“It’s clear that the arguments to go on delaying rate hikes are getting thinner and thinner on the ground. Labour market and Brexit worries have eased and the FOMC is also now recognising slightly better news on business investment and inventories.
It sounds like several members are getting increasingly vexed about the risk of unemployment falling too far and prompting a damaging scenario of more abrupt tightening later on.
A few more weeks of reasonable data flow in the absence of renewed downside external risks is likely to tip the balance in favour of 25 bps by December. “

21 September 2016 FOMC interest rate decision:

“I think they are laying the groundwork for a December rate hike but after two disappointing GDP prints they want to wait and see if growth has actually recovered in Q3.
The labour market data seems less of a reason to wait now but the recent weakness in non-oil business investment is likely giving them grounds to hold off a bit longer. ”