Below are the key takeaways, via Reuters, from the FOMC's updated economic projections.
- Median view of appropriate federal funds rate at end-2018 2.375 pct (prev 2.125 pct); end-2019 3.125 (prev 2.875 pct): end-2020 3.375 (prev 3.375 pct) longer-run 2.875 pct (prev 2.875 pct).
- Median forecast of Fed policymakers is for a total of four rate hikes in 2018.
- Fed sees slightly higher 2018 GDP growth, lower unemployment in 2018-2020, higher inflation in 2018-19 vs previous forecast.
- Median Fed long-run forecasts - GDP growth 1.8 pct (prev 1.8 pct); jobless rate 4.5 pct (prev 4.5 pct); PCE price index 2.0 (prev 2.0 pct).
FOMC Preview: 8 major banks expectations from June meeting
We are closing into the FOMC’s June policy decision and as the clocks tick closer to the decision timing, following are the expectations as forecasted by the economists and researchers of 8 major banks along with some thoughts on the future course of Fed’s action.
US Dollar Index Technical Analysis: Greenback hammered down ahead of FOMC
The US Dollar Index (DXY) has lost about 40 cents after attempting to break above Tuesday’s high. Although the selling has been fairly intense, DXY is trying to find a support at the bull channel (black line).
About the FOMC statement
Following the Fed's rate decision, the FOMC releases its statement regarding monetary policy. The statement may influence the volatility of USD and determine a short-term positive or negative trend. A hawkish view is considered as positive, or bullish for the USD, whereas a dovish view is considered as negative, or bearish.
About FOMC economic projections
This report, released by Federal Reserve, includes the FOMC's projection for inflation and economic growth over the next 2 years and, more importantly, a breakdown of individual FOMC member's interest rate forecasts.
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