FOMC meeting results in a weaker dollar

14 June, 2018

The FOMC raised rates by 0.25 bps yesterday evening to a 1.75% to 2.00% target range in a hawkish move and reaffirmed its expected forecast of 2 more hikes in 2018 and 3 in 2019. The move had been fully anticipated by markets and so did not come as a big surprise. The committee cited a solid growth outlook and greater confidence that inflation is converging on target as supporting their decision. The End of year GDP forecast was raised to 2.8% from 2.7% and the FED is strongly committed to the 2% inflation target. The USD reacted by strengthening against other currencies but this moved was faded with the USD now weaker against EUR, GBP and JPY than when the rate decision was announced. US stocks initially moved higher but again the move was faded and they closed in the red.

UK Consumer Price Index (May) was 0.4% (MoM) and 2.4% (YoY) against an expected 0.4% (MoM) and 2.5% (YoY) from 0.4% (MoM) and 2.4% (YoY) previously. Core Consumer Price Index (YoY) (May) was 2.1% against an expected 2.1% from 2.1% prior. Producer Price Index – Input (May) was 2.8% (MoM) and 9.2% (YoY) against an expected 1.6% (MoM) and 7.6% (YoY) from 0.6% (MoM) and 5.6% (YoY) previously. Retail Price Index (May) was 0.4% (MoM) and 3.3% (YoY) against an expected 0.4% (MoM) and 3.4% (YoY) from 0.5% (MoM) and 3.4% (YoY) previously.

These data points showed CPI holding steady, with the yearly number above the Bank of England’s 2% target since March of 2017 due to the change in the value of the pound after Brexit. Producer Prices have continued to increase with big beats against the expected numbers. GBPUSD moved lower from 1.33349 to 1.33110 after this data was released.

Eurozone Industrial Production (Apr) was released at -0.9% (MoM) and 1.7% (YoY) against the consensus for -0.5% (MoM) and 2.8% (YoY) from a prior of 0.5% (MoM) and 3.0% (YoY). This data extended its decline with the monthly figure slipping back under zero after rising last month.

US Producer Price Index ex Food and Energy (YoY) (May) was 2.4% against an expected 2.3% from a previous reading of 2.3%. This data beat the expected number by 0.1% this month. EURUSD moved higher from 1.17584 to 1.17816 after this data release.


Source link  
Oil hits 3-month lows

On Monday, the dynamics of oil was in the spotlight on a combination of negative factors by both the potential demand and the supply part. Asian markets...

Fed Monetary Policy Report to be released

This report is release twice a year and provides an insight into the conduct of monetary policy and economic developments and prospects for the future for the...

The Pound continues to weaken

Cable (GBPUSD) took a hit yesterday as Boris Johnson resigned from the Cabinet following the earlier decision by David Davis to part ways...


The latest Brexit proposals

The UK's Brexit Secretary David Davis has resigned along with two junior ministers, Steve Baker and Suella Braverman, over PM May's latest softer Brexit proposals...

Some ECB members want earlier rate hike

The markets remain subdued after yesterday's 4th of July celebrations in the US. Despite this Oil headlines are dominating the markets once again. US President Trump...

Gold has played out as a double top

The gold chart has played out as a double top with a break under 1300.00 signalling a move down to 1240.00 from its highs at 1365.00. We have now hit the 1240.00...


Gold chart has played out as a double top

The gold chart has played out as a double top with a break under 1300.00 signalling a move down to 1240.00 from its highs at 1365.00. We have now reached...

President Xi warns of Full Scale Trade War

Risk on sentiment returned briefly yesterday as markets retraced some of Monday’s selloff but sentiment in Asia has declined overnight. The PBOC cut...

USD extend losses in risk adverse markets

Stock markets fell hard yesterday as trade tensions deepened and the consequences of such action has investors worried. US Company Harley Davidson...


In the past 24 hours Bitcoin has lost -1.6% and reached $7319.77. Open your trading account with the best cryptocurrency brokers on special terms today.

In the past 7 days the EUR/USD pair has lost -0.2329% and is now at $1.1646. Start trading and making money on Forex today.

In the past 7 days Ethereum has gained 8.37% and is now at $475.966. Have the most popular cryptocurrencies compared online 24/7.


Top Brokers offering Daily Forex Market Reviews


Forex Currencies Forecasts


Top 10 Forex Brokers 2018

# Broker Review
1easyMarketseasyMarkets90%
2FXTMFXTM88%
3HYCMHYCM86%
4FIBO GroupFIBO Group79%
5FxProFxPro78%
6FXCMFXCM73%
7AvaTradeAvaTrade69%
8HotForexHotForex68%
9XMXM68%
10Alfa-ForexAlfa-Forex66%
  


Share: