RBC Global Asset Management wrote a recent brief entitled, "The Fed Continues to Enact the Year of the Dots." The piece reads, "The Federal Open Market Committee (FOMC) continues to fulfill the path of their 'dot plot' and has voted to raise the Fed Funds Rate 25 basis points (bps) to 1.75-2.00%. The FOMC stated that it 'expects that further gradual increases in the target range for the federal funds rate will be consistent with sustained expansion of economic activity, strong labor market conditions, and inflation near the committee's symmetric 2% objective over the near term.'" RBC explains, "Current economic and geopolitical conditions support our expectation that the Fed will hike two more times this year. The Fed's plan to continue to raise interest rates gradually depends on a number of supporting economic fundamentals: a strong labor market, federal tax cuts and spending polices, high household and business confidence, stable financial conditions, and adequate global growth." They conclude, "Looking beyond 2018, we are uncertain if the Fed will continue to fulfill the path of their current projections. We are seeing a flatter yield curve, increased tensions from protectionism, ongoing geopolitical concerns, and market volatility from tighter financial conditions. As these issues and other uncertainties build into 2019, we think the Fed's dot trajectory will become harder and harder to achieve. 2018 may prove to be first and last time the Fed was able to carry out the 'Year of the Dots.'"

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