Daily News: June 17, 2014

Fed Will Raise Rates Faster Than Investors Expect

According to most economists surveyed by Bloomberg News, the Fed will probably raise its benchmark interest rate faster than money-market investors expect.

Bloomberg notes that eurodollar futures, the world’s most actively traded short-term interest-rate contract, are underestimating the pace of tightening over the next two years, according to 55% of 56 economists in the June 12-16 survey.

Bloomberg quotes a senior economist at Deutsche Bank Securities as saying, “Investors may be focusing on the first-quarter economic contraction caused in part by unusually severe winter weather. Instead, they should be paying attention to recent signs of rebound.”

To read the entire Bloomberg article, click here.