Tim Anderson Weighs In Before Fed Announcement

Tim Anderson is a Managing Director at TJM Investments and a frequent Benzinga correspondent. According to Anderson, "virtually no one" expects the Fed to announce a rate increase today, but "their policy statement will be scrutinized for clues as to how comfortable they are raising rates in the future." He says that economic indicators this week have been ideal for those in the Fed looking to delay a hike, with both the Empire State Manufacturing Report and industrial production figures coming in as misses. Anderson calls the manufacturing data "a head-scratcher" for economists, as it left the manufacturing business relatively flat in Q2 after strong gains in Q1. It was the second negative reading for the index in the past three months. He says these results fly in the face of those who argue that economic contraction in Q1 was due to bad weather and others who have been touting economic progress over the last 6-8 months. The industrial production numbers gave a similarly negative outlook, according to Anderson. Not only was May's data a miss, at -0.2 percent, but April's figure was also revised down to -0.5 percent. Anderson sees this as yet another reason to expect a dovish Fed today. "Where does this leave us?" asks Anderson. "With almost 1,000 [percent] certainty that the Fed will not give us a ‘surprise' rate hike this afternoon."