Investors should not be too quick to write off an interest rate hike by the Federal Reserve in December, despite market expectations increasingly looking to early next year as more likely, the former executive vice president at the New York Fed said Monday.
Most market watchers and economists don't expect any rate move when the Fed concludes its two-day meeting on Wednesday. But going into this week's gathering, the central bank wants to keep December alive, Krishna Guha told CNBC's "Squawk Box."
"In my view, the leadership is still hedging its bets, reserving judgment, waiting to see what those next two employment reports have to say," he said, warning that this week's policy statement could tilt a "little bit more in the direction of being slightly more hawkish."
The government's October employment report is released Nov. 6, and the November data are out Dec. 4, less than two weeks before the final Fed policy meeting of the year.
"They're goal going in is not to double-down on the idea that for sure they're committed to hiking in December," said Guha, currently vice chairman of research firm ISI Group. "But to make sure they have all options open, and people don't conclude already that December is written off."