The dollar is "hiding" behind the Fed
18.12.2014
It is unlikely that one would expect that the "spread" between the monetary policy of the Federal Reserve and the European Central Bank to just go away. It will only increase in size and grow, as the ECB has lost too much time watching the destruction of the European economy.
The December meeting of the Federal Reserve has been very correct in the comments and extremely accurate with respect to expectations. The key interest rate was kept at 0-0.25% per annum, as expected, but this time, Janet Yellen paid more attention to the conditions and prospects of monetary tightening. If the text of the speech is retold, it turns out that the Fed does not rule out raising interest rates at the next meeting, but "here right now," will not do this because inflation is far from the target, and the labour market can show the best results.
Two key points remain: employment and inflation. The labour market continues to improve its position and balances at about seven-year highs, covering the employment of an increasing number of Americans. But the inflation is still far from the goal of the Fed's 2%.
At least, there is no ambiguity and everything is extremely clear - what indicators should be closely monitored, and which require further observation and analysis. In the second half of the day it is worth paying attention to the weekly report on the number of requirements for unemployment benefits in the United States.
The euro/dollar will remain under pressure for now. In this case, the side corridor remains familiar at 1.2210-1.2600.
RoboForex Analytical Department
The December meeting of the Federal Reserve has been very correct in the comments and extremely accurate with respect to expectations. The key interest rate was kept at 0-0.25% per annum, as expected, but this time, Janet Yellen paid more attention to the conditions and prospects of monetary tightening. If the text of the speech is retold, it turns out that the Fed does not rule out raising interest rates at the next meeting, but "here right now," will not do this because inflation is far from the target, and the labour market can show the best results.
Two key points remain: employment and inflation. The labour market continues to improve its position and balances at about seven-year highs, covering the employment of an increasing number of Americans. But the inflation is still far from the goal of the Fed's 2%.
At least, there is no ambiguity and everything is extremely clear - what indicators should be closely monitored, and which require further observation and analysis. In the second half of the day it is worth paying attention to the weekly report on the number of requirements for unemployment benefits in the United States.
The euro/dollar will remain under pressure for now. In this case, the side corridor remains familiar at 1.2210-1.2600.
RoboForex Analytical Department
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Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.