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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Les H who wrote (28368)	10/4/1999 6:37:00 PM
From: Les H	Respond to of 99985

Wall Street sees rates unchanged By Richard Quest in New York When the Federal Reserve Open Market Committee - the interest rate setting body - sits down on Tuesday to set US interest rates Wall Street believes it knows the result. No change. That's the conclusion from an unscientific quick ring round of fifteen of the big names on the street. 93% said they saw no change to the Fed Funds or Discount rate, and that would be that. The one dissenter, Mr Joe Battapaglia of Gruntal and Co believed that rates would go up a quarter of a point. When it was pointed out he was out on a limb he said "I like it that way." Nor does Wall Street expect the Fed to change the bias - the signal it send as to future policy. Currently at neutral, 80% said it would remain that way and would not shift to either tighten or loosen. A clear indication that the Street believes things are set for some time to come. As to whether rates will rise before the end of the year - here the question becomes more tricky. 60% said that rates would not change but 40% did expect some small tightening by 2000. One former governor of the Fed, Mr Wayne Angel, now Chief Economist at Bear Stearns said the reason they were so certain was because of the statement put out after the last meeting when the fed announced "that the steps taken before markedly diminish the risks going forward." Having already raised rates twice this year Mr. Angel interprets this as meaning" Alan Greenspan is ready to take a wait and see stance." Looking further down the road, though, it becomes clear "it doesn_t mean that there wont be a rate increase down the way" but only after the last moves have had a chance to work their way through the economy. Wall Street it seems is clear. No Increase and No Shift in the bias. At least not for now. The FOMC meets in Washington on Tuesday 5th October. news.bbc.co.uk Also, More UK Firms Going Bust news.bbc.co.uk