FOMC decided not to change interest rates as market expected. Moreover, the median for 2016 was left unchanged at 0.875% while lowered was for 2017 - from 1,875% to 1,625%. Nevertheless, it’s not a fairly good news for USD as 6 FOMC members see now only 1 rate hike in 2016. Previously only one member was in favour of just one rate hike.
Below the key points of FOMC statement:
- Labor market slowed since April meeting despite economic pickup
- Expects labor market indicators ’will strengthen’
- Repeats that economy to warrant only gradual hikes
- Spending strengthened, housing continued to improve
- Market based inflation compensation measures ’declined’
- Inflation to rise to 2% as oil and import price disinflation fades
- Pace of labor market improvement has slowed
- Will closely monitor inflation and global financial conditions
At 19:30 Janet Yellen starts her press conference. EURUSD goes up towards 1.13.
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