The Swiss bank UBS has updated its call on the number of rate hikes that the U.S. Federal Reserve will announce this year.
UBS believes that fewer concerns over the softness in inflation within the Federal Reserve and higher oil prices will lead the central bank to increase rates three times in 2018. It had previously estimated two rate hikes.
"We are changing our Fed call for 2018 and 2019, projecting three hikes in 2018 and two hikes in 2019. We see the Fed hiking at the March, June and December meetings this year, and at the June and December meetings next year," a team of UBS economists said in a note on Wednesday.
"We had originally thought that the Fed would skip a hike at the March meeting because the softness in inflation in 2017 had created a debate inside the Committee."
However, minutes from the December meeting showed a lesser degree of internal debate over inflation, the bank said.