As was widely expected, the Fed further reduced the pace of its asset purchases. The FOMC upgraded its assessment of economic activity and was more firm in its view that the drag from fiscal policy was diminishing. No mention was made of recent financial market volatility in its statement. Markets continue to expect the Fed to reduce the pace of asset purchases by $10bn per meeting through to September, and a final $15bn in October to conclude QE3.
Despite the move from the Federal Reserve being almost exactly as expected, we have seen GBP/USD falling with the rate hovering just below 1.6500
Yesterday we also had a 0.50% rate increase from the RBSA (Reserve Bank of South Africa), despite this rather significant move, ZAR continues to weaken, with GBP/ZAR at 18.76, the highest it has ever been!
We have a busy day on the economic calendar with German jobs data already released, we have seen EUR firm up a fraction.
Later we have German Inflation data but probably the event of the day will be USD GDP figures at 1 pm today.
Posted in Daily Market News on May 30 2014
At 7.00pm today we will have the Federal Reserve press conference in which they announce their decision on policy, such as interest rates and stimulus. The market is expecting (and has priced in) a $10bn reduction in the monthly stimulus package - this being referred to as tapering as they...VIEW FULL ARTICLE
Posted in Daily Market News on Jan 29 2014 by admin