The Fed left rates unchanged as expected. The statement did acknowledge the pick up in both growth and employment. They also mentioned that inflation was stable. This was basically stating what we already knew. The slightly hawkish tone came from a “business as usual” attitude towards Brexit as well as a hawkish dissent from Esther George. She is a known hawk and has already voted for rate hikes in the past.
The US dollar reacted positively in the immediate aftermath. It gained across the board with AUD/USD standing out in its falls. The greenback then retreated from the highs. The currency pair that stood out was cable: the pound showed some strength.
All in all, it was quite a “dead” event, in comparison to the Fed’s declarations that every event is a live one.
The Federal Reserve was not expected to change interest rates at its July meeting. There is no press conference nor fresh forecasts. The Fed is torn between an improving US economy and global worries, mostly Brexit. Here are some previews from banks and our video preview.
Valeria Bednarik, Mauricio Carrillo and I are covering the event. Follow our coverage of the event and the live blog.
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