Markets seem to have taken a break in the past few hours, waiting for the release of the Federal Open Market Committee’s key rate decision. After two days of meetings and discussions, Fed members will inform markets at 2 p.m. about their decision regarding the key rate of the world’s biggest economy. Because the Fed provides very little clear indications into its coming actions, we will have to focus on its outlook of the country’s economic performance to estimate if a key rate hike is still in the cards.
Investors are not expecting a hike in July, but many are waiting to see if the Fed will be willing, through an encouraging estimation of its economic performance, to start normalizing rates in the fall, maybe as soon as at the next meeting to be held in September. Such a positioning from the Fed would support a U.S. dollar that is already strong compared to its peers.
