Markets:
Gold down $22 to $3366US 10-year yields down 1 bps to 4.39%WTI crude oil flat at $74.87AUD leads, CHF lagsS&P 500 down 1 pointThe market continues to play the guessing game on the Middle East and some less-hawkish comments from Trump weighed on oil but broader market moves were locked up in anticipation of the FOMC. The decision, statement and dots didn't move the market much. The dots barely remained at two cuts this year as growth expectations moved down but inflation moved up.
The start of the Fed press conference was also ignored but US dollar buying picked up as Powell highlighted incoming goods inflation and said they expect a meaningful amount of inflation in the next few months. That saw USD/JPY rise to 145.15 from 144.60 before the Fed. Similarly, the euro and pound ticked down around 40 pips.
The bond and stock market moves were small and the overall message from Powell was that they were waiting for more clarity, which was what everyone was expecting. The swing is going to come on the data, so we will wait for more numbers but --- notably -- Powell was also confident on the economy, even as some metrics slip.
The market is going to quickly shift back to the trade war and the Middle East war as market drivers now, which is basically a guessing game on what Trump will do next. He said he hasn't made a decision on Iran.
This article was written by Adam Button at www.forexlive.com. Read More Details
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