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:

2011 british pound forecast 2011 cad forecast 2011 dollar forecast 2011 euro forecast aud/usd Bank of England ECB ecb rate cut ecb rate hike Fed Rate Cut Fed Rate Cut Expectations FOMC Kathy Lien Reserve Bank of Australia

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