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FOMC meeting: Big step towards hike?

Simon Alagbe

Analyst


I expect the tone of the Federal Reserve to become more hawkish and announce a more rapid transition away from the former description of inflation as being "transitory" and this could set the pace for the first rake hike early next year. 

The Bank has been operating a loose monetary policy since the pandemic to arrest the devastating effect of the novel virus and with recent stabilities in the economy of the US amidst rising inflationary pressure the market is expecting a speedup in the winding down of the bond purchase program.  


Verdict: If the statement is hawkish as expected, it will further support the Greenback and could push the stock market southward with gold tumbling and the reverse will be the case if they are dovish.


Instruments to consider

Currencies: EURUSD, GBPUSD, AUDUSD, NZDUSD, USDCAD, USDJPY, USDCHF

Commodities: GOLDs

Index: US30, US100, US500, US2000


Fundamentals

FOMC Economic Projections (US) 8:00 PM

FOMC Statement (US) 8:00 PM

Federal Funds Rate (US)  8:00 PM

FOMC Press Conference (US) 8:30 PM


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