The risk of the US Dollar falling after the FOMC meeting is quite low – Commerzbank
|Today is of course the highlight of the week: the FOMC meeting. Antje Praefcke, FX Analyst at Commerzbank, analyzes the US Dollar (USD) outlook ahead of the policy announcement.
There will be no major scope for USD losses
I think the risk of the Dollar falling after the FOMC meeting is quite low. I cannot imagine a dovish surprise, meaning that the dots will be pulled down after the stronger-than-expected inflation readings in January and February and that Fed Chairman Jerome Powell will signal more willingness to cut interest rates at the press conference. I can rather imagine that the Fed will underline its caution and at least confirm market expectations, i.e. there will be no major scope for Dollar losses.
In this respect, I think the question today is rather how much further the Dollar can gain. I think it will depend on the extent to which the dots meet or even exceed market expectations and how cautious or open Powell will be at the press conference about interest rate cuts. In my opinion, something can be expected, the only decisive question is how much.
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.