FOMC Meeting Minutes | USD Position

Today we have FOMC Meeting Minutes from US at 7pm BST. We will be looking out for any clear tone of hawkishness or dovishness in the minutes to gauge the next leg of greenback direction.

If the minutes show Fed members continued to suggest a June hike remains open and concerns regarding the outlook for the US economy have reduced, USD will likely remain supported as expectations regarding the Fed’s rate hike path are brought forward. On the other hand, if the minutes show a lack of agreement with many opposing views between members, with a June hike appearing highly unlikely, USD will likely weaken across the board.

Description:

Released 8 times per year, 3 weeks after the Federal Funds Rate and FOMC Statement is announced, the minutes provide a detailed record of the FOMC’s most recent meeting, providing in-depth insights into the economic and financial conditions that influenced their vote on where to set interest rates.

Summary:

These minutes relate to the April 27 meeting where the Fed left rates on hold as was expected, the main highlight of the accompanying statement was the Fed removing the reference to global events posing risks to US outlook and stating that they will continue to monitor inflation indicators, global economic and financial elements. Although the Fed have left the door open for a hike on June 15, Futures pricing suggest only a 15% chance of a 25 basis point hike, along with expectations remaining at only 1 hike during 2016, in contrast to Fed expectations of 2 hikes during 2016.

The market’s focus will be on any further insight into the likelihood of a June hike, along with any further commentary in regards to the balance of risks to the US economy, or whether the Fed discussed possible implications from the UK’s EU referendum which takes place just over a week after the Fed’s June rate announcement.

This release was also covered in weekly risk events video here.

The post FOMC Meeting Minutes | USD Position appeared first on Jarratt Davis.

Source:: FOMC Meeting Minutes | USD Position

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