The end of the first quarter of 2018 is quickly approaching. Over the last few months we have seen interest rates continue to climb and are projected to go up through the second quarter based on reports from top economic forecasters.
During this week’s FOMC meeting, the first under new Chairman Jerome Powell, the Fed increased the benchmark index by 25 basis points and signaled the necessity to steepen the path of future increases.
We predict the Fed to hike the Fed Funds Rate two to three more times in 2018. We also see yield curves flattening further in 2018. Both of these are consistent with market indicators. With a perfect storm of factors (heavy T-bill issuance, the U.S. tax overhaul, and the Fed’s policy tightening), we anticipate that short-term rates will eclipse 2.25% by year-end and 1-month LIBOR will likely approach 2.5% by this time next year based upon the Forward Curve.
HOW Q10 KDH CAN HELP: Q10 KDH clients are locking rates on longer fixed rate products for immediate funding and forward commitments up to 12 months. Please contact our team to review current or future investments.