29 Jan 2015
FOMC reinforces Dollar strength – SG
FXStreet (Barcelona) - Kit Juckes of Societe Generale, comments that the Fed’s stance has only reinforced USD strength and increased asset market volatility.
Key Quotes
“No-one is going to change his or her view of when the first Fed rate hike is going to take place as a result of reading last night's FOMC Statement. It;'s release triggered a 1/2% rise by the DXY, a 3bp fall in 2-year US rates, a slightly bigger fall at the longer end of the curve, and a 33-point fall by the S&P into the close.”
“The Fed's assessment of growth was, at the margin, slightly more upbeat while the fall in inflation was noted.”
“The reference to being patient in beginning to normalise rates indicates no move is likely before June.”
“The SG view is that rates will rise around mid-year, while others believe there won't be a hike in 2015 at all.”
“The interest rate reaction suggests that the ‘weak hands' are still bond-bears, while the twin trends of increased asset market volatility and a stronger dollar are reinforced.”
Key Quotes
“No-one is going to change his or her view of when the first Fed rate hike is going to take place as a result of reading last night's FOMC Statement. It;'s release triggered a 1/2% rise by the DXY, a 3bp fall in 2-year US rates, a slightly bigger fall at the longer end of the curve, and a 33-point fall by the S&P into the close.”
“The Fed's assessment of growth was, at the margin, slightly more upbeat while the fall in inflation was noted.”
“The reference to being patient in beginning to normalise rates indicates no move is likely before June.”
“The SG view is that rates will rise around mid-year, while others believe there won't be a hike in 2015 at all.”
“The interest rate reaction suggests that the ‘weak hands' are still bond-bears, while the twin trends of increased asset market volatility and a stronger dollar are reinforced.”