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Fed’s Hand May Finally Be Forced

14 December 2015 in Trading Ideas

At long last, the wait is over.

Well… probably.

This week, the Federal Reserve will hold its last policy meeting of the year, and traders in futures markets are putting an 85% probability on the central bank raising short-term interest rates by a quarter-percentage point from near zero when the meeting concludes on Wednesday.

But just as important as the Fed’s decision might be how it telegraphs the pace of rate raises to come. In September, the median forecast among 17 Fed officials called for rates to reach 1.375% in December 2016 and 2.625% in late 2017. That would mean four more rate hikes next year and five in 2017.

As we enter what could be a new era of growing rates (really!), we’ve picked Rising Interest Rates as our Motif of the Week. (OK, this was our Motif of the Week about a month ago too, but this time we mean it!)

Beginning today through Friday, Dec. 18, you can trade this motif, commission-free.

Ready to get started with Motif Investing? Sign up for a free account today.

Jon Hilsenrath, “Fed Plan to Signal Gradual, Cautious Path on Rate Hikes,” wsj.com, Dec. 9, 2015.

$0.00 commission offer is for trades (buys, sells, rebalances) of the benchmark version of the Motif of the Week. Commission-free buys, sells, and rebalances end 4PM ET December 18, 2015. Commissions for the Motif of the Week that is customized in any way – adjust weighting, add or remove securities will include a $9.95 total commission per motif transaction or pay $4.95 per stock for individual stock/ETF transactions. Regular commissions apply for other Motif-created benchmark motifs and customer-created customized motifs ($9.95 total commission per motif transaction or $4.95 per stock for individual stock/ETF transactions). Other fees may apply. Motif reserves the right to review and amend the commission pricing structure at any time in the future and will notify you in writing of any intended changes. For details on fees and commissions, please click here.

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