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Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA

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To: J.T. who wrote ()1/9/2000 10:58:00 AM
From: Joseph Stratmann  Read Replies (1) of 19219
 
Market already factor in two rate hikes according to the Wall Street Journal.

I was just reading the WSJ online. An article discussing Friday's market move stated the following:

"Analysts noted that investors already have factored in at least two interest-rate increases by the Fed over the next few months. Futures contracts on the federal funds rate show investors expect the funds rate to rise to 6% by April, an increase of half a percentage point"

1)What index can I use to show the that futures contracts on fed fund rate expects a 6% rate?

2)They state the market factored in two hikes. How do they figure that? Is it simply the Futures contract refelected a 5.5% rate and now it's 6 (two 25 basis point hikes)?

3) Does the number given by this index show a direct rate or another number that you'd have to manually 'crunch' to derive the rate it reflects?

Thanks for your patience with my dumb questions. :)

-Joe
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