Forex

Here's What Markets Expect from September Fed Meeting Minutes

2019-10-09 14:16:04 GMT (Economies.com)

The global markets are anticipating the release of the US Federal Reserve meeting minutes later today, which will carrie with it the details that led to US second straight rate cut this year in addition to clear signes about the future of the policy easing during this year.

 

By 18:00 GMT, the minutes of the Federal Open Market Committee (FOMC) meeting which was held at September 17-18 will be released, as the meeting saw the second US interest rate cut during this year.

 

The the benchmark rate cut came after 7 members voted against 3 for a quarter point to between 1.75% and 2.00%, and the bank stated that the cut is due to risks posed by global developments and weak inflation.

 

Fed Governor Powell, said that the US economy is in an overall good place and labor market is still strong and that rate cuts are a precautionary measure to stimulate growth, noting that the Fed's future decisions will besd on the monitoring of the incoming economic data.

 

While in case of the meeting minutes showed more-than-expected pessimistic details about the US economy, the odds for further easing of the monetary policy and the future of the US rate cuts will then increase for the next October and December meetings, marking a 4-cut cycle during this year, and the US dollar will be then poised for a sharp downtrend.

 

But in case of the details are less pessimistic with confirmation of the US economic strength, then odds will shift to the possibility of a third rate cut this year, which is in favour of the US dollar.

 

Bearing in mind that President Trump has been repeatedly requesting from the Fed and Chairman Jerome Powell for deeper interest rate cuts.

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