The big bet is on, as the Fed's September meeting looms
And the most likely outcome looks to be a draw between the Hawks and the Doves
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IT'S as if the starting orders have just been given in the Grand National or the Kentucky Derby and investors are nervously gripping their betting slips, waiting for the gun. All the frenzied running around of the last moments of bet laying is finished and a hush has gone over global markets.
The biggest betting event of this year is not the Grand National or the Kentucky Derby or the Manny Pacquiao fight ... it's the Federal Reserve September meeting. This is a contest between the Hawks, or pro-rate hike bankers, and the Doves, who favour a looser monetary policy. Over the last few months, billions of dollars have piled into Treasury bonds, utility stocks and other rate-sensitive securities, betting on the outcome of Thursday's statement.
Recent data, including one of the weakest services-sector surveys of the post-recession years and another lacklustre manufacturing report, prompted some big bets that the central bank won't move until 2017.
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