Upward revisions to 1.2% for first quarter growth have confirmed the world’s largest economy to be in rude health, strengthening the case for a Fed rate hike on June 14th.
Yellen will find the 0.60% quarterly uptick in consumer spending to be particularly pleasing ahead of what is being enthusiastically priced in by fixed income markets – the implied probability of policy action was above 80% at the last count. Unless Donald Trump repeats his NATO tactics and shoulders his way into the headlines and barring any shock disappointments in the data calendar, no market event appears capable of preventing a mid-June US interest rate hike.
Pound hit by election jitters as US growth figures boost dollar
Richard de Meo quoted in The Guardian