Hollenhorst Says Likelihood of Dec. Fed Rate Hike at 50%

The transcript discusses the probability of a rate hike by December, emphasizing the challenges in forecasting inflation, which is crucial for determining rate hikes. It highlights the dependency on inflation data and compares market expectations from speeches by Yellen and Draghi, noting that the ECB could surprise the market, unlike the Fed, which is more predictable.

What is the main challenge in forecasting inflation according to the discussion?

• It is not influenced by external factors.

• It follows predictable business cycles.

• It has been in secular decline for decades.

• It is easier to predict than economic growth.

What is the key factor that will determine the December rate hike?

• Inflation data

• Business cycles

• Economic growth

• Interest rates

How is Mario Draghi's speech expected to differ from Yellen's in terms of market impact?

• It is expected to be more predictable.

• It is anticipated to be more surprising.

• It will focus on the US economy.

• It will not address the balance sheet.

Why were investors more focused on Draghi's speech compared to the Fed's actions?

• The Fed's actions were already priced in.

• Draghi's speech was expected to be boring.

• The ECB had no potential to surprise.

• The US economy was outperforming Europe.

What aspect of the European economy was highlighted as exceeding expectations?

• Inflation rates

• Economic growth

• Interest rates

• Unemployment rates