Any doubts over about December Fed hike may be swept away

Fri Nov 13, 2015 8:34pm EST
 
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By Jonathan Cable

LONDON (Reuters) - Inflation numbers from the United States on Tuesday could be the provider of the final domino in the Federal Reserve's track to raise interest rates next month.

Earlier in November a robust report on U.S. employment hardened expectations for the Fed's first rate increase in nearly a decade and if prices are shown to be rising steadily those views will likely solidify.

Reuters polls see inflation a 1.9 percent year-on-year, unchanged from the previous reading.

Minutes from the Fed's October meeting will also be published, giving an insight into the Committee's decision to remove a key sentence on global risks from its policy statement.

"We have had a strong October jobs report and Fed Chair Janet Yellen herself referring to a December rate rise as a 'live possibility' for the first time," said Chris Hare, economist at Investec.

"The coming week should shed a little more light on the prospects for tightening this year."

While most U.S. data has been relatively upbeat, retail sales rose less than expected in October, suggesting a slowdown in consumer spending that could temper expectations of a strong pickup in fourth-quarter economic growth.

In the meantime, Britain's Bank of England was once pegged as likely to be the first major central bank to tighten policy but prices fell again last month, data will probably show on Tuesday.   Continued...

 
Federal Reserve Chair Janet Yellen arrives for a news conference following the Federal Open Market Committee meeting in Washington September 17, 2015.  REUTERS/Jonathan Ernst