FOMC Statement – Forex Trading News Event of the Week

FOMC (Federal Open Market Committee) Statement – Wednesday the 29th of April 7:00pm

FOMC Statement coming out on Wednesday the 29th is definitely the highlight of this week’s Forex News Trading events. Why? Because we are really keen to hear what the FED are going to say. Are they going to change their statement? Are they going to moderate what they say? And most importantly, are they going to hike their rate?

In my opinion, there is probably only 2% chance they will be doing that. However, Federal Funds Rate will be announced too and if they do decide to adjust it we would see absolute fireworks in the market. Simply because no one expects that. So, it’s something to keep one eye on as well but the big thing of course is the FOMC Statement itself.

What the FED will say? How do they view the fact that since 18th of March 60% of high impact news events from the US have came in worse than expected? How do they feel that the last NFP reading was significantly below expectations as well? Do they view it as a blip or maybe they view it just as a consequence of having a bit of a bad winter? Cold weather holds things back and Q1 data is always a bit negative. Things start picking up in the Q2.

In short, the main question is will FED say ‘no, everything is as it was, we are not concerned’. Statement like that could lead to a bit of dollar strength returning. Or will they scare the markets even more by going a little more dovish and saying: ‘actually we want to see what is happening here, we were not expecting these data points to start coming out quite so bad, we were very surprised by NFP etc. Basically, if they indicate at any moment that it is a concern or that they are thinking about holding off from a rate hike again we could see the volatility on a US dollar to continue.

So to sum up, FOMC Statement is not a risk event you want to be trading into. However the outcome of the statement could set the tone for the US dollar for the weeks to come. So keep the focus on what the FOMC Statement is going to announce and what the FED is focused on.

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