Federal Reserve Seen to Hike Rates in May and June – Poll

Source: Reuters

Economists expect the Federal Reserve to tighten interest rates in the next two months amid a 40% chance of a recession in 2022. QQQ is down 1.77%, while SPY is down 1.20%.

• A survey of over 100 economists shows that the Fed is predicted to hike interest rates by back-to-back half-point increases in May and June.
• Some 85 of the 102 economists surveyed expect hikes rates by 50 basis points next month, while 56 of the respondents expect another hike in the next month.
• Should this be realized, this will be the first such move in 28 years and bring the funds rate to 1.25% to 1.50% by the meeting in June.
• The federal funds rate is predicted to fall between 2.00% and 2.25% by the end of the year, 50 basis points higher than economists predicted last month.
• Respondents also expect a recession in the next 24 months, with the bond market already indicating signals.