Richard Perry
Independent Analyst
The announcement of statement from the Federal Reserve suggests that the US remains last man standing in terms of its path towards rate tightening. However the reaction of the market to the announcement would suggest that this has been broadly as expected, with only a minor bout of US dollar strength as a reaction. The words “considerable time” were removed and have been effectively replaced with “patient”. The Fed also noted a “strong” labor market and “solid” growth, whilst the voting was unanimous. However the market did not take this as an overtly strong signal for the dollar, or at least it has not yet. Equity markets fell sharply but this is more a function of the falling oil price ad continuation of a reaction to negative results (Apple aside) than the Fed. Wall Street was sharply lower with the S&P 500 another 1.4% down at the close and back towards 2000 once more. The Asian markets were broadly lower and European markets are sharply lower in early trade today.
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