Factbox-Wall Street banks expect Fed to hike rates in July

(Reuters) – A few major U.S. banks expect the Federal Reserve to deliver another 25-basis-point rate hike in July after the central bank on Wednesday signaled that borrowing costs may need to rise by as much as half a percentage point by the end of the year.

Money markets are currently pricing in a nearly 72% chance of a 25 bps rate hike in July, and the first rate cut in March next year.

Following are forecasts from some big U.S. banks and their global counterparts:

Brokerage July September Comments Terminal

Rate

Expectati

on

BofA 25 bps 25 bps 5.5% –

hike hike 5.75%

Moved

25 bps expectation for June 5.5% –

Citigroup (NYSE:) 25 bps hike hike to September

hike

5.75%

JP Morgan 25 bps No hike 5.25%

hike 5.5%

Goldman 25 bps No hike Sees a possible 5.25% –

Sachs hike second hike as more 5.50%

likely in

November than

September

Morgan No No hike “In the very 5.1%

Stanley hike near-term, the bar

to a July hike is

not

insurmountable but

we think would be an

Olympic feat”

Deutsche 25 bps No hike 5.3%

Bank hike

UBS

25 bps

hike

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