Don't Wait for the Yellen Speech to Make This One Investment
By JACK DELANEY, Associate Editor, Money Morning • June 20, 2016
The Federal Reserve decided to keep interest rates unchanged last week, but investors will learn much more about the decision this week from the Janet Yellen speechto Congress on June 21 and June 22.
The Fed chairwoman will appear before the Senate Banking Committee on Tuesday and the House Financial Services Committee on Wednesday. In this semiannual meeting, Yellen will share the Fed's view on U.S. economic growth and interest-rate hikes.
After the Fed left rates unchanged last week, investors are looking for any hints from the Yellen speech if a rate hike for July is on the table.
According CME Group's FedWatch Tool, investors believe a rate hike will happen closer to the end of the year or at the start of 2017. Here's how the odds of a rate hike look for the rest of the year:
- July 2016 Rate Hike Probability: 12%
- September 2016 Rate Hike Probability: 38%
- November 2016 Rate Hike Probability: 40%
- December 2016 Rate Hike Probability: 57%
- February 2017 Rate Hike Probability: 58%
But no matter what Yellen tells Congress, investors shouldn't wait for the Yellen speech to protect their investment portfolios.
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