Michael Woolfolk Interest Quotations

Given the recent spate of positive January data, CPI and durable goods are unlikely to disappoint. The USD is positioned to make new gains ... as favorable U.S. growth and interest rate differentials weigh on market sentiment.

Unemployment has drifted further below 5 percent, and at those levels you have to start being concerned about bidding up of wages. There's a compelling reason to hike interest rates at the next meeting.

Were this trend in new home sales to continue, the Fed will be less likely to increase interest rates, which would be a dollar negative.

The monthly GDP report fed into underlying CAD strength. With political risk subsiding, rising interest rates and fundamental economic strength are prompting CAD buying, which is expected to continue through year-end as USD/CAD heads for the 1.10 mark.

There's a compelling reason to hike interest rates at the next meeting.

Interest rate differentials are supporting the U.S. dollar for the time being. Until the Fed pauses, it looks that's going to provide support for dollar bulls.

The hike in March is fully priced in. The hike in May is over 80% priced in. There is already talk of continued hikes after that. Interest rate differentials globally are increasingly favoring the U.S. and it's positive for the dollar.

The dollar rally after the non-farm payrolls report underscores the continued importance of labor market tightness with respect to interest rate expectations.

The market took this to mean that there is a 100 percent chance that interest rates will be increased at the next meeting and a 75 percent chance at the meeting after that.