After trekking the end of 2015, the Fed lowered expectations to 2 Raise in 2016
the USD recorded the worst quarterly performance since 2010 as Fedspeak and Fedfacts clashed. The Federal Open Market Committee March (FOMC) disappointed with its dovish tone, especially after the European Central Bank (ECB) had gone all in its quantitative easing (QE) push earlier in the month. Member Fed hawkish remarks reversed the USD lower, to be brought back to earth after the speech Fed President Yellen at the Economic Club of New York.
The release of the FOMC minutes in March could put additional downward pressure on the dollar when they are published Wednesday, April 6 at 14:00 EDT. Comments from the Federal Reserve Bank of Kansas City President Esther L. George will be actively sought as she was the lone dissenter on the vote to keep interest rates unchanged.
facts of the Fed and official statements stressed the caution with which the central bank will address the decision to raise rates in the future. The patient's position has made the market punish the USD against other pairs as it is unlikely that there will be over 2 rate hikes in 2016, when at the end of 2015 the expectation supported by forecasts the Fed was twofold.
The EUR / USD has been a loss of 0.10 percent over the past 24 hours. The USD rose slightly ahead of the release of the March Federal Open Market Committee (FOMC) meeting minutes. The USD was able to get that investors seem to safety and close long positions before the uncertain comments from Fed members on the US economy and the effects of a global slowdown on growth.
currencies commodities were affected by the risk of movement combined with the uncertainty in the energy market. The Doha summit was mostly a source of stability to the volatile energy prices, but comments from the Organization of Petroleum Exporting Countries (OPEC) and non-OPEC countries raised doubts about the output freeze oil deal to be signed on April 17. Saudi Arabia and Iran continue at the heart of the disagreement.
The Watch CME tool Fed shows that the market and the Fed agreement on a limited number of rising prospects rates. The FOMC September is a likely candidate for a rate hike with a 40 percent rate increase. June and December are also in the race because they have a press conference following the release of the federal funds rate statement.
The Fed CME tool shows a 18 per cent in June and 57 percent for December. Going by the behavior of the Fed in June last is probably too early and the central bank would act with a limited set of data. The main challenge to September is the proximity of the US presidential election in November and the risk of a rate hike seen as biased to a particular candidate. December becomes the most likely choice, but remains to be seen whether the US economy will be ready by then, so far, the Fed can afford to be patient and told through the statements of its member that it could let inflation run hot before raising rates.
USD events to watch this week:
Wednesday, April 6
10:30 USD crude oil inventories
2:00 pm USD FOMC Meeting Minutes
Thursday, April 7
8:30 USD unemployment claims
Attempting EUR ECB President Draghi Speaks
5:30 p.m. USD Fed President Yellen Speaks
Friday, April 8
4:30 GBP manufacturing Production m / m
8:30 CAD employment Change
8:30 CAD unemployment rate
* All times EDT
for a complete list of scheduled events in the forex market, visit the economic calendar MarketPulse
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