Yesterday was marked by the release of the minutes from the last FOMC meeting. They confirmed that a majority of Committee Members already had, as of last October, a relatively positive opinion regarding the U.S. economy and that conditions were favourable for a rate hike. Most recent speeches from members have not contradicted this position. Consequently, barring a big surprise, it does seem that the Fed is preparing to raise its key rate slightly in December.
Further to this news, financial assets—including the U.S. dollar and U.S. bonds—barely moved. Stocks, which had reacted negatively to any monetary tightening threat for many months, actually ended the session higher by 1.5%. All of this leads us to believe that the key rate hike has already been discounted in the price of financial assets. The real question therefore becomes: what comes next for the greenback and for U.S. bonds?
In terms of economic news, today we will be monitoring Initial Jobless Claims in the United States.
Have a good day!
Julien Duquette