Fed may again hike rate in March

The rising wage rate is warning that the inflationary pressure in the economy will be higher in near future.  Therefore, contractionary monetary policy is anticipated from the Fed at 16th December meeting. This will be the first rate hike by the Fed since 2006.

The November jobs report surprised on the upside and give boost the market's Fed rate hike expectation. 

"We continue to believe that rising inflation pressures will prompt the Fed to raise rates more aggressively next year, with the fed funds target range reaching 1.25-1.50% by end-2016, equivalent to four quarterly 25 bp hikes next year or roughly twice the tightening compared to current market pricing. After next week's move, we believe the Fed will hike rates again in March", says Nordea Bank in a research note.