Barclays Plc and BNP Paribas SA think the Fed will hike on September 21.

Even more curious, Barclays is based in London, and BNP Paribas is headquartered in Paris.

Is some sort of FX or interest rate fix in?

Market-Defying Call

market-defying-call

Please consider Two of Fed’s Own Primary Dealers Warn Shock Hike Awaits Markets.

There’s uncommon dissent in the ranks of the Federal Reserve’s primary dealers over the central bank’s interest-rate decision this week.

Two of the Fed’s 23 preferred bond-trading partners — Barclays Plc and BNP Paribas SA — are betting against their peers and the bond market by forecasting officials will raise rates Wednesday. It’s the first time more than one dealer has gone against the consensus during the week of a policy meeting since last September, data compiled by Bloomberg show. Economists at both banks say traders have too steeply discounted officials’ intent to hike after the Fed has remained on hold for longer than expected.

Barclays had forecast a rate hike at the Fed’s June meeting until a dismal May jobs report at the beginning of that month. This is the first time the bank has called for a Fed increase through the week of an FOMC meeting since December, said Rob Martin, senior U.S. economist at Barclays.

“We’re not the crazy house — this is the first time we’ve been so far out of consensus on the view,” Martin said. “We’ve kept our conviction on September because we think that’s what the FOMC has communicated to us — that’s what we think the chair and the vice chairman were talking about at Jackson Hole.”

Crazy House

Given Barclays has a history of bad Fed hike calls, the most likely explanation is they made another one.

Humorous December 2015 Flashback

StockCats Posted a string of these …

Speaking of strings ….

String of Bad Economic Reports

For sure the Fed wanted to hike. But…

I cast my lot with the consensus.

Mike “Mish” Shedlock