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I had been expecting the Federal Reserve to hike interest rates before most people expected. Now I think it’s time for me to change that outlook (and yes, we always want to change our market views based on new information — you never want to be tied to a thesis).

First, check this out. It’s from the Cleveland Fed and shows the market’s take on a Federal Reserve rate hike at the next few FOMC meetings. The lesson is that the market overwhelmingly expects the Fed to keep rates unchanged at near 0%.

Here’s a look at May 2012 futures contract for the Fed Funds rate. This is a full year away and the market has turned decidedly against any major move from the central bank.

(Click chart to enlarge)

Source: Put Those Rate Hike Expectations on Hold