June 07, 2016 (LBO) – U.S. interest rates may rise gradually after comments from Federal Reserve Chairwoman Janet Yellen on Monday, along with a surprisingly weak jobs report released on Friday.
Yellen she said Friday’s jobs report was “disappointing” and “on balance, concerning,” but cautioned against placing too much significance on one economic report.
The probability of a June rate hike fell to 4 percent, and a hike by July fell to 27 percent, according to the CME group 30-day Fed Fund Futures. Chances of a rate hike rise to 49 percent by September.
According to the Wall Street Journal, Yellen’s speech suggested “the Fed’s intention to gradually raise interest rates remains on track,” Alan Gayle, director of asset allocation at RidgeWorth Investments, which manages 37 billion dollars, said.
If the jobs report for June shows improvement and the U.K. votes to remain in the European Union, “July is very much on the table,” he added.
Although Sri Lanka’s private sector credit growth has been running above 25 percent, the Central Bank has been reluctant to tighten interest rates too quickly, and is likely to take cues from international markets.
Sri Lanka rupee forwards strengthened on Monday after the IMF approved a 36-month 1.5 billion dollar facility to Sri Lanka to support its reform programme.
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