This week we looked at the following topics,

  • FOMC Interest Rates and Statement
  • RBNZ Interest Rates and Statement
  • AUS Employment
  • GBP Interest Rates and Statement
  • CAD CPI and Retail Sales

 

Also, Economic outlook for today,

21/3/2018
FOMC Rate Decision Ahead

Last night we had some mixed volatility in the major currency pairs. With prices dropping in for the EURUSD, NZDUSD, GBPUSD, while relatively unchanged in the AUDUSD, USDCAD and USDJPY.

Currently, most pairs are sitting in consolidation near to strong support/resistance levels. This consolidation is expected to continue until the FOMC decision.

Expectation is for the Federal Funds Rate to increase for 1.50% to 1.75%. This is likely to give strength to the US dollar, but since the rate increase has been expected, the impact of the decision is likely to be priced in.

Therefore, more importantly, we’ll need to look at the economic projections/ statement/ conference for an indication of how the FOMC views the US economy for the future.

Paying extra attention to on their expectation on:
– 3 or 4 interest rate increases for 2018
– Confidence with regards to achieving the inflation target
– Employment situation, given that we had a strong NFP but weaker unemployment and wage data.

-Jin

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