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- The Forex today was focused on what could be the result of the FOMC and, subsequently, on the US dollar trading on the fact.
- The DXY was punished at the conclusion of a Fed dovish. It went from over 96.50 seconds to a new low below the February 28 low, losing the 96 manipulate for the first time since.
Continuing with the Fed, the fact that some participants look for a tad inclination to find that the Fed does not expect rates to rise until 2020, the markets have relaxed and the United States to 10 years the yield fell sharply from 2.59% to 2.52%, after reaching 2.61% before the Fed. At the same time, the Fed's balance sheet will end in September and many did not expect this to happen soon – GDP forecasts were also revised downward. Here are some of the highlights of the meeting that will likely continue to weigh on the greenback:
The latest median forecast of the Federal Reserve
- 2019 GDP 2.1% vs 2.3% in December
- GDP 2020 of 1.9% vs 2.0% in December
- 2021 GDP 1.8% vs 1.8% in December
From the declaration
Federal Reserve issues FOMC statement – March 20 – full text
- Over 12 months, headline inflation declined, mainly due to lower energy prices; Inflation of products other than food and energy remains close to 2%.
- Overall, market – based inflation – offset measures have remained weak in recent months, and measures of long – term survey – based inflation expectations have not changed much.
- The Committee decided to maintain the federal funds rate target range of 2-1 / 4 at 2-1 / 2%.
- The Committee believes that the most likely results are a sustained expansion of economic activity, favorable labor market conditions and inflation close to the symmetrical 2% target of the Committee.
- In light of global economic and financial developments and moderate inflationary pressures, the Committee will be patient as it will determine what future adjustments to the federal funds target range might be appropriate to support these results.
Meanwhile, we also had shenanigans on the Brexit all day supplemented by a statement by Prime Minister May to the British nation, explaining that she had written to Tusk to request an extension until the end from June, but no further than that. This will be the subject of a vote Friday in Brussels, which will be a major event for the pound that is currently stuck between the lighthouses and on the ice – because just a member of the 39; EU to veto the request of the British Prime Minister, which means that the UK could end up dropping out of the EU next Friday without an agreement.
New Zealand's GDP data was as follows in early Asia, but there was no big jolt, the kiwi being between 30 pips on line data for Q / Q and a slight moss between year and year – little The RBNZ next week, will probably stay with his position of "watch and wait".
Monetary action:
Westpac badysts summarized the action on currencies in the G10 countries as follows:
"The EUR / USD jumped from 1.1355 to 1.1448 in response to the Fed's surprise, and then dropped to 1.1420." The USD / JPY fell from 111.50 to a low of 110.54. from 0.6845 to 0.6918, a two-month high, then back to 0.6880 The AUD / NZD fell sharply to 1.0340, falling a little after the FOMC.
The GBP was the weakest of the G10, the EU summit having started with a Brexit review, it decided to extend the Brexit date from 29 March to 30 June only if the UK Parliament approved the PM plan May. GBP / USD lost about -0.6% over the day, including a slight rebound by the Fed. "
Key notes of the American session:
Key upcoming events:
Westpac badysts said the markets are now waiting for the February Australian Labor Force Survey, due to be released at 11:30 am Syd / 8:30 am Sing / HK. "In the minutes of the March 5 board meeting, RBA members" observed that the labor market situation had continued to improve, despite a slowdown in growth in the labor market. production in the second half of 2018. "The RBA will not let fall its optimistic view of the job market simply on a softer reading today."
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