FOMC Interest rate decision (FED) | News & Analysis


Fed emergency package of measures: Facing coronavirus

FED'S LAST EMERGENCY MEASURES REVIEW

Fed takes additional actions to provide up to $2.3 trillion in loans to support economy

The US Federal Reserve announced on Thursday that it has taken additional actions to provide up to $2.3 trillion in loans to support the economy. Key takeaways from the statement "Will assist households and employers of all sizes as well as state and local governments." "Will purchase up to $600 billion in loans through Main Street Lending Program aimed at small and midsize businesses using $75 billion in capital from the US Treasury."

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FED Latest Analysis



March Fed Emergency Rate Cut


January Fed Decision Review

FOMC and Chairman Powell wait and watch

Certainty is a rare commodity in finance and economics but today’s unanimous FOMC decision was about as close as markets are likely to come. The Fed governors reaffirmed that the current rate of 1.50% to 1.75% was appropriate for the economy and best suited for its employment and inflation...


Decemeber Fed Decision Review

Fed Analysis: Powell doubles down on dollar-devastating comment – more may be in store

Technical traders are often looking for a double-top or double-bottom to confirm a line of resistance or support. Also for fundamental traders, sometimes repetition is needed to trigger a move. Jerome Powell, Chairman of the Federal Reserve, has said that he would personally raise rates only after seeing significant and persistently high inflation. That contrasts the reaction function for cutting rates seeing a change to the future outlook.


October Fed decision review

FOMC lowers federal funds rate by 25 basis points to 1.5% - 1.75% range as expected

Following its 2-day meeting, the Federal Open Market Committee (FOMC) on Wednesday announced that it lowered the benchmark interest rate by 25 basis points to the target range of 1.75% - 2% in a widely expected decision. Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, is scheduled to deliver his comments on the monetary policy outlook in a press conference at 18:30 GMT.

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Editors' Picks

AUD/USD: Above 0.6300 on Good Friday holiday with eyes on China CPI

AUD/USD remains above 0.6300, despite stepping back from the monthly high of 0.6363 to currently around 0.6330, at the start of Friday’s Asian session. Markets in Australia/US are closed for Good Friday, Chinese markets are up with March month inflation data on the cards.

AUD/USD News

USD/JPY: The greenback ticks down, trades above 108.00 figure

USD/JPY consolidates gains above the 108.00 figure. The level to beat for buyers is the 109.50 resistance. USD/JPY bull trend stays intact as the spot trades above the 108.00 handle and the 50/200 SMAs on the four chart.

USD/JPY News

Gold: Multiple upside barriers before crossing $1,700

Despite probing the multi-year high, marked on Thursday, Gold prices near the key resistances while taking rounds to $1,685 at the start of Friday’s Asian session. The Good Friday holidays in major markets are expected to limit the yellow metal’s moves.

Gold News

Why stocks are recovering and where next

The S&P 500 index has recovered around half the losses it suffered due to the coronavirus pandemic. Is bad news priced in? How much credit does the Federal Reserve deserve? Where next for equities?

Read more

Gold: Multiple upside barriers before crossing $1,700

Despite probing the multi-year high, marked on Thursday, Gold prices near the key resistances while taking rounds to $1,685 at the start of Friday’s Asian session. The Good Friday holidays in major markets are expected to limit the yellow metal’s moves.

Gold News

Majors

Cryptocurrencies

Signatures


Big Picture

What's important about Federal Reserve’s monetary policy meeting?

With a pre-set regularity, a nation's Central Bank has an economic policy meeting, in which board members took different measures, the most relevant one, being the interest rate that it will charge on loans and advances to commercial banks.

In the US, the Board of Governors of the Federal Reserve (FED) meets at intervals of five to eight weeks, in which they announce their latest decisions. A rate hike tends to boost the local currency, as it is understood as a sign of a healthy inflation. A rate cut, on the other hand, is seen as a sign of economic and inflationary woes and, therefore, tends to weaken the local currency.

If rates remain unchanged, attention and also main news and analysis turn to the tone of the FOMC (Federal Open Market Committee) statement, and whether the tone is hawkish, or dovish over future developments of inflation.

What is the Fed?

The Federal Reserve System (Fed) is the central banking system of the United States and it has two main targets or reasons to be: one is to keep unemployment rate to their lowest possible levels and the other one, to keep inflation around 2%. The Federal Reserve System's structure is composed of the presidentially appointed Board of Governors, partially presidentially appointed Federal Open Market Committee (FOMC). The FOMC organizes 8 meetings in a year and reviews economic and financial conditions. Also determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth. FOMC Minutes are released by the Board of Governors of the Federal Reserve and are a clear guide to the future US interest rate policy.

How to trade the event?

  • Do not rely on the Fed to determine the direction of the dollar in the coming months.
  • The dollar tends to follow its predominant trend when the Fed starts to hike rates.
  • There is no direct link between the Fed hiking rates and the usd falling. When a weak usd has coincided with a Fed hiking cycle, it has been falling for some time.
  • Due to this, we may see a muted reaction to a potential Fed rate hike.

WHO IS FOMC'S CHAIRMAN?

Jerome Powell

Jerome PowellJerome Powell took office as chairman of the Board of Governors of the Federal Reserve System in February 2018, for a four-year term ending in February 2022. His term as a member of the Board of Governors will expire January 31, 2028. Born in Washington D.C., he received a bachelor’s degree in politics from Princeton University in 1975 and earned a law degree from Georgetown University in 1979. Powell served as an assistant secretary and as undersecretary of the Treasury under President George H.W. Bush. He also worked as a lawyer and investment banker in New York City. From 1997 through 2005, Powell was a partner at The Carlyle Group.



The World Interest Rates Table

The World Interest Rates Table reflects the current interest rates of the main countries around the world, set by their respective Central Banks. Rates typically reflect the health of individual economies, as in a perfect scenario, Central Banks tend to rise rates when the economy is growing and therefore instigate inflation.

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