Financial Times FT.com

Short View: Rate expectations

By John Authers, Investment Editor

Published: June 22 2009 18:32 | Last updated: June 22 2009 18:32

What does the market expect to hear from the US Federal Reserve on Wednesday? The answer is tied to the market’s belief in economic “green shoots”.

Two weeks ago, after the number of Americans leaving non-farm payrolls proved much less than had been expected, traders could perceive green shoots everywhere. Futures trading then implied expectations that the Fed would certainly start raising rates by the end of the year.

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