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March 20, 2018

IronFX, Volatility Alert: Fed's Interest Rate Decision on Wednesday!

All Eyes on the FED – Tomorrow, 21 March 2018

This article is originally referred from IronFX News.

Tomorrow, investors are awaiting for FOMC’s Interest Rate Decision, and it is expected to rise.

Here are 7 important points for investors!

  1. On Wednesday, at 18:00 (GMT), the Fed will announce their decision regarding the Interest rate.
  2. Currently Feds Funds Futures imply by 100% that the Fed will raise interest rates by 25 basis points to +1.75%.
  3. However the market widely expects it to happen already, so the US Dollar’s direction will depend on other factors.
  4. The dot plot could reveal the banks intentions for a 3 or a 4 rate hike path. Should the median of the FOMC’s votes show a possibility of the number of rate hikes to be 4 in 2018 we could see the US Dollar strengthening.
  5. Even if the dot plot remains unchanged, a possible upgrade of the economic outlook could also strengthen the greenback.
  6. Should the accompanying statement have a more hawkish tone the USDollar again could strengthen.
  7. The following press conference will be Powell’s first and the new Fed’s Chairman has proven that he is not shy of his opinion even should his opinion be a market mover, so we expect volatility to continue throughout the press conference as well.

The interest rate decision is one of the most influential economic events regarding a currency’s value in relation to other currencies.

Shortly before the decision and shortly after, there is usually higher volatility, providing the market with opportunities for further gains.

Original Source: IronFX News

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