Daily Commentary BY THE CURVE TEAM –

The December Meeting Is Finally Here

13th of December, 2017

All eyes will be on the US overnight with the FOMC making their much anticipated rate decision at the December meeting.

For some time now, Fed Chair Janet Yellen has been pointing towards the December meeting for the next rate hike in their monetary policy normalisation schedule. The market has completely priced in the rate hike and anything other than a hike will come as an enormous surprise.

Along with the headline decision, the latest dot plot will capture the attention of the market. Based on recurring commentary over the last few months, it is unlikely we will see any material change to the dot plots (in 2018 anyway) as the Fed seems to be rolling along at around about the pace they want to. The expected US CPI figure year-on-year is 1.80% and if the latest number prints in line with these expectations then it could be a sign that inflation is starting to pick up again after a lacklustre start.

Domestically, the merger and acquisition news was heavily publicised with a European owner of of shopping malls agreeing to buy Westfield $34.7bn AUD. RBA Governor Phillip Lowe also spoke this morning at the Australian Payment Summit 2017 in Sydney on e-AUD and the evolution of payments systems.

James Winder

Client Relationship Manager