KUALA LUMPUR (Nov 29): AmBank Group Research said a  December rate hike by the U.S. Federal Reserve looks cemented.

In an economic report today, AmBank Group chief economist and head of research Anthony Dass said strong consumer confidence, which surged to a near 17-year high in November reading at 129.5, is being supported by a robust labour market, while house prices rose sharply in September.

He said it appears that consumers are entering the holiday season on a strong note as they expect the economy to expand at a healthy pace in 2018.

“Our 4Q2017 gross domestic product projection for now is at a 2.5% annualized rate.

“We believe the December rate hike by the US Fed is almost cemented. The question now is not only how many rate hikes the Fed will institute in 2018 but also how far the tightening cycle will go.

“We are looking at 3 rate hikes in 2018, each by 25 basis points should the broad package of tax cuts go through despite worries about persistently low inflation,” he said.