The once lofty expectations of an additional interest rate hike to occur in 2016 are shrinking. This minimized chance follows a recent Fed policy statement, which suggested that the U.S. central bank might not hike rates in the midst of a slowing economy.
However, a hike is not out of the question; there is a predicted12-percent probability of a quarter-point increase when the Federal Open Market Committee’s next policy meeting ends on March 16, but according to CME’s Fed Watch Tool, the probability of four rates hikes occurring in 2016 is close to 0 percent. Sources show a 50 percent chance of the next rate hike occurring in December, 2016.
Read the full Fed policy statement here.