SAN RAFAEL, Calif.—The predictions of a Federal Reserve rate hike in June likely won’t come true, according to Dan Geller.
Geller, a financial behavior scientist who also assembles the Money Anxiety Index, contends that a “relatively weak first” quarter may convince the Fed to push the rate hike to September.
“June is too soon because the second quarter results will not be available, and December is too late because it is over the critical holiday shopping season,” said Geller in a release.
Geller noted that the Fed Open Market Committee (FOMC) has three more meetings this year that are followed by a press conference—June, September and December.
“Due to the importance of the initial Fed rate hike, it's highly likely that the first move will occur during one of these meetings,” Geller said.
In the March 18 FOMC meeting, the votes were almost evenly split between an initial rate hike in June and September, Geller pointed out.
“However, in the March FOMC meeting the committee did not have the March disappointing job report, which means that more members of the committee will push for a September initial hike in order to better evaluate the employment situation,” he said. “A December hike is not very likely because it is too late in the year and is right over the holidays' season.”
Geller added that lately, consumers have been exhibiting signs of financial nervousness about the economic recovery. The April Money Anxiety Index is flat at 65.7, indicating that the level of financial anxiety among consumers is not improving as evident from their spending level.