Fed members sounding curiously cautious - Westpac

Ross J Burland FXStreet

Influential Fed centrists Williams (soon to be NY Fed President) and Dallas President Kaplan last week reiterated an upbeat message for 2018 but sounded curiously cautious thereafter.

Key Quotes:

"Kaplan cautioned that the tax boost would fade in 2019, slowing growth to 1.75%-2.0% in 2020, putting him at the lower end of the central tendency."

"Williams did not speak to 2019 specifically but did note that the “tax cuts are front-loaded” and that optimism about r-star is misplaced, noting, “I’m conscious that the fundamental drivers that govern r-star are lower than we’ve seen in the past” (i.e. demographics, productivity growth and the demand for safe assets)."

"Against that Fed Governor Quarles has noted that tax cuts could drive supply side improvements and raise r-star."

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

AUD/USD trims some losses, bounces back to 0.7150

AUD/USD has traded on the back foot on Monday, coming close to the 0.7100 mark before rebounding toward the 0.7150 region ahead of the opening bell in Asia. The Greenback’s solid performance has kept the risk complex under pressure, sending the Aussie to fresh monthly lows on the back of rising bets for a Fed rate hike this week. on Tuesday, investors are now expected to closely follow key data releases in China.

USD/JPY: Japanese Yen edges lower vs USD amid Middle East jitters as Fed, BoJ meetings loom

The USD/JPY pair attracts some buyers at the start of a new week and climbs closer to the 154.00 mark during the Asian session, reversing a part of Friday's losses. Spot prices, however, remain confined in a range held over the past week or so and within striking distance of a nearly seven-month low, touched last Tuesday, as traders await this week's key central bank events.

Gold retests $4,300; USD losses momentum

Gold picks up fresh upside traction and challenges the key $4,300 mark per troy ounce on Monday. The yellow metal, however, remain on the back foot on the back of marked gains in the US Dollar and rising US Treasury yields across the curve.

JasmyCoin: Upbit delisting raises risk of further losses

JasmyCoin shows signs of stability at the time of writing on Monday. However, the token remains constrained between support at $0.0035 and resistance at $0.0040. Since May, its technical structure has continued to deteriorate, with the price falling from highs of $0.0078. JASMY’s outlook suggests that bears have the upper hand as bulls fight to defend key support levels.

Will the Fed deliver the hawkishness markets are pricing in?

Fed hike bets increase after PPI and CPI reports. Updated dot plot to be crucial for the dollar’s reaction. Warsh’s independence faces test amid Trump’s pressure for lower rates. For the Dollar to extend gains, Fed needs to satisfy current hawkish bets.

Venezuela’s 65-billion-barrel Oil deal could reshape America’s inflation fight

The United States (US) has secured unprecedented access to part of Venezuela’s vast Oil reserves. The timing is particularly significant as the war with Iran is disrupting Middle Eastern supplies, keeping energy prices elevated and reviving concerns about inflation.