- January 29, 2020
- Posted by: John Curran
- Category: Market News
Good morning,
FOMC interest rate decision is underway today at 2PM EST. The Central bank is not likely to make any substantive changes to monetary policy but the devil will be in the details as traders key in on economic developments of the phase one US/China trade deal and the impact of the coronavirus on global growth. For now the probabilities of a .25% rate hike sit at just over 12% with the chance of a cut at zero percent. Going out to the June meeting forward bets of a cut heighten to 27.3%. Should FED Chair Powell signal a more optimistic tone the chances of a cut during in the June meeting should diminish greatly. Generally talk of a cut should dampen stock prices and give the US dollar a boost. A more cautious tone from the FED could spur the opposite effect, selling off the safe haven dollar with capital flowing into riskier assets like stocks. Technicals remain little changed with USD/CAD support of 1.3067, the 21 day moving average along with resistance at 1.3233, representing the 200 day moving average.