Fed's deluge of dots and discord confuses markets
Moreover, data dependence has seen the US central bank's outlook change dramatically in just a few months
Washington
THE US Federal Reserve's decision next week on whether to raise interest rates is a vital issue for markets and investors around the world. Problem is, all the speeches, forecasts, meeting minutes, press conferences and media interviews given by Fed officials in the lead-up are muddying, not clarifying, the outlook.
Case in point: Boston Fed president Eric Rosengren on Sept 9 said the economy could overheat if they waited too long to raise interest rates, contributing to a 2.5 per cent rout in the S&P 500 Index that was the biggest move since the UK's vote to leave the European Union. Three days later, Fed governor Lael Brainard argued there's no rush to tighten, helping to lift the S&P 500 by 1.5 per cent in the equity benchmark's biggest one-day reversal since January.
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