The FOMC meets next week – “more hawkish” is a meaningful risk

I posted earlier on the risk of a more hawkish view from the Federal Reserve next week:

• The Federal Open Market Committee (FOMC) meet next week – “the risk leans a bit hawkish”

A snippet from Bank of Montreal argues the same:

• It’s easy enough to keep a cut penciled in for June and that’s precisely the market’s bias at the moment. We’re cognizant that the rationale for a June cut could readily shift next week in the event that the SEP update is skewed toward stickier inflation and fewer rate cuts in 2024. While not our base case assumption, a more hawkish takeaway from the March 20th FOMC events needs to be on the table as a meaningful risk.

The consensus for a June rate cut is dropping, this from the CME FedWatch Tool:

This article was written by Eamonn Sheridan at www.forexlive.com. Source