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FOMC, ECB, RBA Meetings: What is Priced in?
The Federal Reserve, European Central Bank and the Reserve Bank of Australia have monetary policy meetings scheduled this week and some investors expect these central banks to change monetary policy. Here’s what the market is pricing in according to interest rate futures. You can compare them with the Central Bank expectations back in September. What is interesting is that the market does not expect the ECB to cut interest rates this year even though many economists predict a 50bp cut in December.
FED -- Nada for 2011 and 2012
ECB -- 25bp rate cut by July (sharp upgrade from Sept when rate cut expected in Dec)
BOE -- Nada for 2011 and 2012 but slight shift to dovish bias
BOC -- Rate Cuts now expected in 2012, down from rate hike by April
RBA -- 25bp Rate cut by Dec -- upgrade from 100bp by year end
RBNZ -- No Major Changes, Rate Hike Expected July 2012
And here are the details: