EFTA Document EFTA01458585

Macro outlook Fed remains cautious The Fed is likely, however, to proceed in slow and small steps. Inflation remains at a very low level so that inflationary risks are limited. Low commodity prices also help to keep inflation at bay. We expect the federal funds rate to increase in several steps to 0.75-1.00% by September 2016 - a level which would still be well below our 2016 inflation-rate expectation of 1.6%.' An additional argument against a larger interest-rate rise is provided by the