How the dot plot changed
Here is the dot plot from June 2017:
It shows:
- 4 Fed members expecting no more hikes this year
- 8 Expecting one more hike this year
- 4 Expecting two more hikes this year
- A media at 2.00-2.25% for year-end 2018
Here is the new dot plot:
- Still only 4 Fed members expecting no more hikes this year
- 11 expecting another hike this year
- 1 expecting two more hikes this year
- 2018 is similar, still three more hikes priced in
- Terminal rate down to 2.8% from 3.0%
This is more aggressive than anticipated and that's why the dollar is bid.
