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Why Should the Fed Raise Rates in September? -- Market Talk

DOW JONES & COMPANY, INC. 10:22 AM ET 07/29/15


10:22 EDT - Russ Certo, managing director of rates trading at Brean Capital, is among those advocating for a September FOMC hike. Besides stronger economic fundamentals, he contends the Fed wants to "rein in the era of complacency" as investors have been used to ultraloose monetary policy. "The Fed wants to test the water and see how markets react. Financial stability has been a big focus for the Fed." He also thinks the central bank may want to get off the ground earlier to avoid the potential political brinkmanship in 2016. Nonetheless, Certo doesn't expect big moves in the Treasury market this afternoon either way: Even if the Fed could signal it is ready to tighten in September, the statement will likely put in lots of qualifiers to signal this cycle would be gradual and slow. ([e-mail]; @ minzengwsj)


(END) Dow Jones Newswires
07-29-151022ET
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