Fed's Bostic: Economy is expected to lose further momentum
|Raphael Bostic of the Federal Reserve Bank of Atlanta warned that rising price pressures over the next six to twelve months could intensify the Fed’s challenges.
FOMC Interest rate decision (Fed) | News & Analysis
US Fed leaves rates on hold as expected, Powell hakwish
LATEST FED MEASURES TO BATTLE INFLATION
Fed's Daly says Fed still has work to do on inflation
|Fed Bank of San Francisco President Mary Daly noted late on Wednesday that despite overall progress, the Fed still has some ground to cover on its fight with inflation pressures, and cautioned that the Fed may be forced to act soon without having the full picture.
Fed's Collins and Cook caution about the risks of policy uncertainty
|Fed Bank of Boston President Susan Collins and Fed Board of Governors member Lisa Cook participated in a virtual discussion on Wednesday, with both key policymakers cautioning that overarching uncertainty remains a key sticking point for Fed policy transmission.
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July decision review
Breaking: Federal Reserve keeps rates unchanged, as expected
|At its July policy meeting, the Federal Reserve held the Federal Funds Target Range (FFTR) steady at 4.25%–4.50%, exactly as markets had anticipated.
June decision review
Breaking: Fed leaves interest rate unchanged at 4.25%-4.5% as expected
|The United States (US) Federal Reserve (Fed) announced on Wednesday that it left the policy rate, federal funds rate, unchanged at the range of 4.25%-4.5% following the June policy meeting. This decision came in line with the market expectation.
May decision review
Breaking: Fed leaves policy rate unchanged at 4.25%-4.5% as expected
|The United States (US) Federal Reserve (Fed) announced on Wednesday that it left the policy rate, federal funds rate, unchanged at the range of 4.25%-4.5% following the May meeting. This decision came in line with the market expectation.
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EUR/USD trims losses, back above 1.1650
EUR/USD remains slightly on the back foot on Friday, trading around 1.1650 amid some modest recovery in the US Dollar. Investors, in the meantime, are expected to shift their attention to next week's US inflation data release. Fed officials' comments and trade news also remain in focus.
GBP/USD turns positive near 1.3450
GBP/USD now flirts with the 1.3450 zone, managing to bounce off daily lows as the Greenback’s advance loses some traction. The British Pound remains bolstered by the BoE's hawkish cut at its meeting on Thursday. Cable remains en route to close the week with marked gains.
Bank of England cuts rates in dramatic meeting
The Bank of England has cut rates by a further 25 basis points to 4% but the statement hints that officials think the easing cycle is nearing its end. Policymakers are visibly worried about a more persistent bout of inflation as the headline number is way higher than target.
Gold keeps the rangebound mood near $3,400
Gold seems to have entered a consolidation phase around $3,400 per troy ounce, giving up some gains after previous highs over $3,410. The announcement that the United States would tax one-kilo and 100-ounce gold bars is also supportive of the precious metal.
Crypto Today: Bitcoin uptrend takes a breather as Ethereum, XRP bulls tighten grip
The cryptocurrency market is relatively bullish on Friday, buoyed by renewed risk-on sentiment from both institutional and retail investors. Bitcoin surged toward the $118,000 round-figure resistance before retreating slightly to trade at around $116,525 at the time of writing.
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Big Picture
What's important about the Federal Reserve’s monetary policy meeting?
With a pre-set regularity, a nation's central bank holds a monetary policy meeting where board members take different measures, the most relevant one setting the range of the federal funds rate, which greatly influences the interest rate charge on loans and advances to commercial banks.
In the US, the Federal Open Market Committee (FOMC) of the Federal Reserve (Fed) meets at intervals of five to eight weeks to announce their latest decisions. An interest-rate hike increases borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors. A rate cut, on the other hand, tends to weaken the USD.
If rates remain unchanged, the attention, main news and analysis turn to the tone of the monetary policy statement and the press conference from the Fed’s Chair. Markets analyze whether the tone is hawkish or dovish over future developments of inflation.
What is the Fed?
The Federal Reserve (Fed) is the central bank of the United States (US) and it has two main targets: to maintain the unemployment rate at its lowest possible levels and to keep inflation around 2%. The Federal Reserve System's structure is composed of the presidentially appointed Board of Governors and the partially appointed Federal Open Market Committee (FOMC). The FOMC organizes eight scheduled meetings in a year to review economic and financial conditions. It also determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth. The FOMC Minutes, which are released by the Board of Governors of the Federal Reserve weeks after the latest meeting, are a guide to the future US interest-rate policy.
Fed official website, on X and Facebook
How to trade the event?
- Do not rely on the Fed to determine the direction of the dollar in the coming months.
- The dollar tends to follow its predominant trend when the Fed starts to hike rates.
- There is no direct link between the Fed hiking rates and the usd falling. When a weak usd has coincided with a Fed hiking cycle, it has been falling for some time.
- Due to this, we may see a muted reaction to a potential Fed rate hike.
WHO IS FOMC'S CHAIRMAN?
Jerome Powell
Jerome Powell took office as chairman of the Board of Governors of the Federal Reserve System in
February 2018, for a four-year term ending in February 2022. His term as a member of the Board of Governors will
expire January 31,
2028. Born in Washington D.C., he received a bachelor’s degree in politics from Princeton University in 1975 and
earned a law degree from Georgetown University in 1979. Powell served as an assistant secretary and as
undersecretary of the Treasury
under President George H.W. Bush. He also worked as a lawyer and investment banker in New York City. From 1997
through 2005, Powell was a partner at The Carlyle Group.
Jerome Powell Fed's Profile and Wikipedia
The World Interest Rates Table
The World Interest Rates Table reflects the current interest rates of the main countries around the world, set by their respective Central Banks. Rates typically reflect the health of individual economies, as in a perfect scenario, Central Banks tend to rise rates when the economy is growing and therefore instigate inflation.