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To: Les H who wrote (38670)	1/31/2000 3:46:00 PM
From: Les H	Read Replies (1) \| Respond to of 99985

US PRIMARY DEALERS SEE 25 BASIS POINT HIKE AT FEB. MEETING By Nikki Baldwin NEW YORK (MktNews) - All 22 economists surveyed at U.S. primary dealers Friday expect the Federal Reserve to raise the 5 1/2% federal funds target to 5 3/4% at the Feb. 1-2 Federal Open Market Committee meeting. In a survey of 22 of the 30 primary dealers, 19 said the Fed will raise rates again in March to 6%; the remaining three see a second hike in May or June. Fedwatchers said the Fed is concerned with inflation risks from strong growth of the economy and tight labor markets. With fourth-quarter GDP growth strong at 5.8%, and the employment cost index up 1.1% for the quarter, the economy is moving way to fast for the Fed, analysts said. The Fed's "balance of risk" statement following the February meeting -- successor to the intermeeting policy bias -- will cite concern about prospective inflation, the analysts agreed. Looking ahead to year-end most economists see the funds target at 6 1/4%, though some saw a target of 6 1/2%.