Fed talk and key themes coming up - ANZ
|Analysts at ANZ explained the key themes ahead and recent Fed optimism.
Key Quotes:
"Perennial hawk Mester (voter) remains upbeat on the US outlook."
"New Fed Chair Powell said at his ceremonial swearing-in that they remain alert to any developing risks to financial stability. He added, “we are in the process of gradually normalizing both interest rate policy and our balance sheet with a view to extending the recovery.”"
"As watchers attempt to ascertain whether the recent bout of equity volatility is done and dusted or about to burst into broader risk aversion, risk havens provides clues. Overnight JPY and CHF strengthened, and gold prices did lift, but all in a fairly muted fashion."
"We expect the markets to continue to swing between risk-on and risk-off now a solid dose of uncertainty has been added to the trading mix. US CPI tomorrow (2:30am NZT) is the next big test for a market for whom upward inflation surprises have abruptly become A Bad Thing.
The market is expecting 0.2% m/m in CPI ex food and energy (1.7% y/y exp; headline CPI 1.9% y/y exp). One can be fairly confident that an upside surprise would not be taken well."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.