The FED’s decisions are often highly followed events as they have the potential to move markets and shift sentiment and today's event is no exception. The US central bank has been very cautious with handling its fiscal policy in an effort to balance what it refers to as “transitory inflation” and the ever increasing reliance of markets on cheap funds. Today’s decision could carry some extra weight as it will be accompanied by a series of macro economic projections in addition to a press conference by Jerome Powell shortly after. If today’s data shows significant signs of improvement, it could push the FED to issue a clearer statement on the potential timeline of tapering, which as we have seen in the past could have far reaching effects on stock markets, USD and commodities.
Oil prices recover after API report shows unexpected draw
Oil prices have been trading higher for quite some time and have benefited from more optimistic views thanks to the potential recovery of demand in addition to the continuing drop in inventories. Today’s EIA report will be worth following along with the FEDs economic projections, as a confirmation of the current trend could push prices even higher with WTI approaching recent highs around $72. On the other hand, a slowdown in economic growth along with an unexpected increase in inventories could increase pressure on Oil prices moving forward.
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