USD drops, Wall Street gains after in-line Fed decision
Fed delivered a 25 basis point rate hike as expected. Statement did not bear any major changes - the US central bank will continue to monitor and assess incoming information while making future decisions and will assess the impact of tightening on inflation. Quantitative tightening will continue at previously announced pace. There were no hints that the rate hike cycle is near an end or any note of recent drop in inflation. Today's decision was unanimous.
Market reaction has been muted at first - USD pulled back while equities swung up and down. EURUSD moved higher later on and is up around 0.2% compared to pre-announcement levels. S&P 500 futures (US500) caught a bid later on as well. We may have wait until Powell's press conference at 7:30 pm BST for more volatility. However, it looks highly likely that he will stick to his previous narrative of at least one more rate hike this year. Depending on how much he stresses it, USD may recover some losses.
Start investing today or test a free demo
Open account Try demo Download mobile app Download mobile app
US500 caught a bid after Fed decision and is bouncing off the 4,580 pts support and the upward trendline. Index is testing 50-hour moving average (green line). Source: xStation5
This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.
