Every 1 in 3 thinks FED will either hold or ease policy in 2016

After New Year turmoil, hawkish market participants are disappearing rapidly and its doves everywhere. According to latest survey of market participants reveal, every one in three is a dove.

Among 1000 surveyed,

About 56% can be still considered as hawks,

• Only 3% believe, FED will hike rates three times.
• 20% thinks, still two rate hikes are possible.
• Largest number of participants (32.9%) are in favor of single rate hike.

Rest are all doves,

• 29.6% of the participants think, there would be no rate hike this yea
• 3.4% consider that FED will cut rates
• Quite a significant portions of participants (11.1%) think FED will use unconventional policy measures such as negative rates, QE4 in addition to rate cut.

We are still in favor of one or two rate hikes, depending on economic data. FED should realize, global markets have been inflated by FED policy, so a reversal would mean stock market decline, so if economy calls for it market shouldn't be a concern for FED.

Next FOMC meeting is scheduled this week on 27^th January at 19:00 GMT.