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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (44619)	11/1/2005 4:08:45 PM
From: ild	Respond to of 110194

DJ Fed Funds Futures Imply 4.265% Yr-End Rate After FOMC *DJ Eurodollar Futures Fully Priced For 4.5% In 1Q 06 DJ Fed Funds Futures Imply 4.265% Yr-End Rate After FOMC By Christine Marie Nielsen Of DOW JONES NEWSWIRES CHICAGO (Dow Jones)--Federal funds futures contracts reflected expectations for a rate of about 4.265% by year end after the Federal Reserve on Tuesday increased the Federal funds target to 4% from 3.75%. Earlier in the day, the 30-day interest-rate futures contract, which is used for gauging market expectations on the outlook for Fed activity, implied a Fed funds rate of 4.255% by year end. Market analysts said the contract moved little, because the Fed's accompanying statement hardly strayed from the previous statement. "There is nothing in the statement to indicate they are done, nor is there anything here that says they will pick up their pace" of tightening, said Lou Brien, a market strategist with DRW Trading. =DJ Fed Funds Futures Imply 4.265% Yr-End Rate After FOMC -2 In their statement, the Fed reiterated the key phrase that "policy accommodation can be removed at a pace that is likely to be measured." The statement also reiterated that the balance of risks between inflation and growth can be kept roughly equal with the "appropriate monetary policy action." Brien noted that the Fed's comment on energy prices had been tweaked only slightly from the previous meeting's statement. The Fed now says that it is the cumulative rise in energy and other costs that have the potential to add to inflation pressures, Brien said. This is slightly different from September, when the Fed in its rate-decision statement noted it was "higher" energy and other costs that had the potential to add to inflation pressures.