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    A policy U-turn from Fed on a Brexit? - BTMU Ross J Burland

    Analysts at Bank of Tokyo Mitsubishi explained that this dollar demand would likely outweigh the negative impact on the US dollar from a more dovish outlook for Fed policy.Key Quotes:"If Brexit happens, then the Fed will become even more cautious on when to resume gradual rate hikes.Heightened uncertainty over the outlook for global growth could mean the Fed is side-lined for the remainder of the year.For Fed policy to have more of a negative impact on the US dollar, we believe that the market would have to believe that the Fed was likely to perform a policy “U-turn” and begin to ease policy.The Fed would have to become more fearful that the US economy was heading into recession. We doubt that will be the market’s initial Brexit reaction."

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