Fed to accelerate pace of policy tightening

After the Fed’s co-ordinated attempts to prepare markets for another interest rate hike at this week’s FOMC meeting, which concludes on Wednesday, another 25 basis point hike is fully priced into markets. Buoyed by the post-election improvement in the survey evidence and perhaps a bit more concerned by the recent pick-up in inflation, the FOMC apparently believes that it need not wait for more clarity on tax reform.