Market observers are nearly certain the Federal Reserve will announce a rate hike Wednesday and another before the end of the year.
In a CNBC survey of economists, fund managers and strategists, 98% of respondents expect the Fed to hike rates a quarter point Wednesday to a range of 2 to 2 ¼%. Ninety-six percent believed that another quarter-point hike would come in December.
“Fed funds increases in September and December are as certain as can be,” John Donaldson, director of fixed income at Haverford Trust, told CNBC. “Their real challenge starts after the first increase in 2019, which will bring the rate to 2.75%, or finally back even to inflation.”
Survey respondents predicted that the Fed would raise interest rates by two more quarter points in 2019, according to CNBC. About half of respondents also expected a third hike in 2019.