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Investing Specialists

Will the Fed Raise Rates in March?

Upcoming inflation, consumption, auto, and employment reports will be key factors in the decision.

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Recently released U.S. Federal Reserve minutes and a number of more hawkish-sounding Fed speakers raised the prospects of more rate increases in 2017, perhaps beginning as early as the Fed's March 15 meeting. Before this week, the probability of a Fed rate increase in March was nil. By the close of the week, the probability was a much higher 22%.

The minutes suggested that the Fed would be raising rates "fairly soon." Since then inflation and employment both checked in higher than expected. This week one governor suggested that a rate increase was on the table in March, a sentiment echoed by another Fed governor earlier in the week.

Robert Johnson, CFA does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.