Local & International Outlook
Economy Watch: Meeting, voting, rating — and uncertainty
November is going to be a crowded month for market watchers, with the US election taking centre stage internationally, while domestically labour reform, monetary policy and the possibility of further credit rating downgrades will top the agenda. The first calendar item of note is the Federal Open Market Committee meeting on November 1-2 in the US. Though US Fed chair Janet Yellen has said that the meeting remains "live", in the sense that a 25 basis points hike could be announced, the markets believe there is almost no possibility of a move. According to the CME’s Fed Funds Futures Tracker, the probability of a Fed hike in November is just 10%. The odds rise to 70% for the Fed’s December meeting. This is based on the view that the US election, scheduled for November 8, has the potential to be market moving. The Fed is, therefore, unlikely to want to add to the noise by raising rates at its November meeting. Yellen has made it clear that at least one rate hike is on the table for thi...
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