Dec rate hike: Muted impact for Reits as event already priced in

IT seems like investors of real estate investment trusts (Reits) have already priced in a definite rate increase in December, two weeks ahead of the Federal Open Market Committee meeting from Dec 13 to 14.

Two phenomena suggest so.

First, the federal funds futures rate shows the probability of a December rate increase at a full 100 per cent now. The probability has steadily climbed from about 70 per cent at the start of November. This shows a build-up in anticipation.