Market Insider

Why the Fed may not even raise rates next year

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With Wall Street doubting the Fed's willingness to hike interest rates this year, Deutsche Bank's chief U.S. economist said he does not have a lot of confidence the Fed will even raise the fed funds rate next year.

Deutsche economist Joseph LaVorgna's forecast is that the Fed will raise rates in March for the first time in more than nine years, and then follow up with another hike in June. He expects it would then pause while it assesses the impact of its hiking.

But in a note Monday he pointed out that the Fed could delay: "...[W]e do not have much confidence in rate hikes next year given that the Fed had ample opportunity to raise rates earlier this year when the economy and labor market were much stronger, but did not do so," wrote LaVorgna.