- The minutes of the Fed’s March 18-19 meeting will be made on Wednesday.
- Federal Reserve made a cautious waiting at the March event.
- Investors are thinking of a potential ratio at the May 7 meeting.
The United States (USA) Federal Reserve (FED) will be published at 18:00 GMT on Wednesday, eagerly awaited from the 18-19 monetary policy meeting. During the meeting, the policy makers agreed to change the FED funds to 4.25-450%of the target range (FFTR).
The last summary of the update of economic projections (SEP) emphasized a sense of uncertainty within the Federal Open Market Committee (FOMC).
Indeed, the reviews for 2025 and 2026 carefully attracted attention among the policy makers. Nevertheless, despite more conservative expectations, the FED’s estimation still waited for two deductions to the federal fund rate in 2025 and underlined a constant commitment to monetary expansion.
Fed made a hawk waiting and power confirmed this
With a decisive movement, the Federal Open Market Committee unanimously voted to keep the policy rate constant this March. Nevertheless, two issues dominated the debate: a cloud of uncertainty and the approaching effect of US tariffs.
At a routine press conference, the Federal Reserve President Jerome Powell described uncertainty as “unusual raised”. Central Bank officials, Trump administration in the midst of new policy movements in the midst of the rush of economic projections wrestling with great difficulties, he said. Powell warned the FED that he may face delays in pushing inflation targets because inflation has begun to climb – at least a partially attributed to tariffs.
Speaking with business journalists in Virginia on April 4, Powell proved that President Donald Trump’s new tariffs were lar larger than expected ”. He drew a picture of an economic landscape in which rising tariffs could trigger higher inflation and slow growth and potentially push the Central Bank to a series of challenging decisions.
In addition to the conversation, Federal Reserve Governor Adriana Kugler observed that the last increase in goods and market services inflation could be a start for the full impact of tariffs. Despite the changing economic tides, the Fed’s most important priority should continue to control inflation.
When will FOMC minutes be published and how can the US dollar affect?
FOMC will publish minutes from the 18-19 March policy meeting at 18:00 GMT on Wednesday and are preparing for important information of market observers.
Participants will be particularly alert for discussions that cause the slowdown in quantitative squeezing (QT) speed and ratio determinants to reflect “Stagflarationist” scenarios about the updated “dot graph” scenarios.
President Powell made sure that the economy was well positioned, although a potential slowdown in economic activity could put pressure on the US dollar (USD). Discussions on the possible effects of US tariffs are also expected to stand out.
In a recent briefing, Senior Analyst Pablo Piovano from Fxstreet presented a view to the US Dollar Index (DXY).
“In the event that the upper hand is recovered, the index should meet the discussion immediately at the bottom of 2025 (3 April) of 101.26, and even more important in the 100.15 (27 September) 2024 pit, which is shy of 100.00 level.”
“On the other hand, occasional power seizures should find resistance at the weekly peak of 104.68 (26 March), a space below the 200 -day simple movement average below.
Piovano also pointed out that the momentum indicators pointed to more close -term retreats with the daily relative force index and the average direction index near 37 around 42 regions.
Fed FAQ
The monetary policy in the US has been shaped by the Federal Reserve (FED). The Fed has two powers: to achieve price stability and to promote full employment. To adjust the primary vehicle interest rates to achieve these goals. When prices increase very rapidly and inflation is over 2% target of the FED, increasing interest rates increases borrowing costs throughout the economy. This results in a more powerful US dollar (USD), as it makes the US a more attractive place for international investors to park their money. When inflation drops below 2% or the unemployment rate is too high, the Fed may reduce interest rates to promote heavy borrowing on Breding.
The Federal Reserve (FED) organizes eight policy meetings annually, where the Federal Open Market Committee (FOMC) evaluates economic conditions and makes monetary policy decisions. Twelve Nutrition Authorities participate in FOMC-seven members of the Board of National Assembly, the President of the New York Federal Reserve Bank and the remaining eleven regional reserve banks.
In extreme cases, the federal reserve can apply to a policy called quantitative navigation (QE). QE is the process of significantly increasing the Fed’s credit flow in a stuck financial system. It is a non -standard policy measure used during crises or when inflation is extremely low. It was the weapon of the FED during the great financial crisis in 2008. The Fed contains more dollars and uses it to purchase high -grade bonds from financial institutions. QE usually weakens the US dollar.
Quantitative Completion (QT) is the inverse process of QE that the Federal Reserve does not re -invest in the bonds in which the federal reserve stops receiving bonds from financial institutions and matures the principal to purchase new bonds. It is usually positive for the value of the US dollar.
Economic indicator
Farm Payrolls
The out -of -Farm payroll version offers the number of new jobs created in all non -agricultural enterprises in the United States during the previous month; released by US Office of Working Statistics (BLS). Monthly changes in payrolls can be extremely variable. The number is also subject to powerful examinations that can trigger volatility on the Forex card. In general, a high reading is seen as an increase for the US dollar (USD), while a low reading decrease is seen as a decrease, but the previous months reviews and unemployment rate are as relevant to the title figure. Therefore, the reaction of the market depends on how the market evaluates all the data included in the BLS report as a whole.
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