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Strategies & Market Trends : LastShadow's Position Trading -- Ignore unavailable to you. Want to Upgrade?

To: BoNg-N-BoNg who wrote (19302)	8/11/1999 7:19:00 AM
From: LastShadow	Respond to of 43080

As of Friday, economists at 26 of the 29 U.S. primary dealers in the Reuters poll said that the FOMC will raise the fed funds target rate a quarter of a percentage point, to 5.25%. A week earlier, only five of those firms said the Fed was going to go. But none of those firms think the Fed will hike by a half point at the end of the month. For all kinds of reasons. The last time the Fed moved by that much was when it tightened in February 1995, when inflationary pressures looked a heckuva lot more frightening than they do now (in hindsight, such a deep move was probably a bit too much). Furthermore, to hike by that much at a time when markets are thin, when bond players are worrying about credit-spread problems and when nobody expects it goes against the Fed's current MO.