Economists at Barclays now expect Fed to surprise markets with 75-basis-point hike next week

Economists at Barclays said they now expect the central bank to deliver a 75-basis-point rate increase at the monetary-policy meeting on June 14-15. They said that they disagree with the market’s continued expectation for a 50-basis-point hike next week, saying, “[W]e think the US central bank now has good reason to surprise markets by hiking more aggressively.” Still, “we realize it is a close call and that it could play out in either June or July,” they said in a note after the release of the consumer-price index for May.

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