The Fed Will Not Raise Interest Rates Tomorrow

Posted by Louis Navellier on 8/4/08 11:35 am

The fed funds futures contract is pricing about a 30% chance the Fed will raise key interest rates tomorrow, which I agree with, since market rates, based on the 3-month Treasury bill, remain significantly below the current 2% federal funds rate.  Despite outspoken “hawks” on the FOMC, such as Philadelphia Fed President Richard Plosser, I expect that Fed Chairman Ben Bernanke and the other “doves” on the FOMC will prevail and hold key interest rates steady, especially in the wake of last week’s awful economic news.

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