Factbox: Fed rate watch: Powell fuels bets of longer hike cycle, higher rates

[1/3] Federal Reserve Board building on Constitution Avenue is pictured in Washington, U.S., on March 19, 2019. REUTERS/Leah Millis/File Photo

March 8 (Reuters) - As the U.S. economy holds up better than expected in the face of aggressive interest rate hikes, markets have started pricing in a higher peak rate as the Federal Reserve battles sticky inflation in a tight labor market.

Fed Chair Jerome Powell's hawkish testimony to congress on March 7 further strengthened those views, with money markets now pricing in an over 65% chance for a larger 50bps hike in March, compared to less than 30% before the testimony.

The Fed funds rate is currently at 4.5-4.75%, and traders see it peaking at 5.62% in September.

Following are expectations from some major investment banks and brokerages:

Compiled by the Broker Research team in Bengaluru; Editing by Saumyadeb Chakrabarty, Sweta Singh and Anil D'Silva

Our Standards: The Thomson Reuters Trust Principles.

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