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  • Evans speaking to reports saying ‘Could well be reasons for another 25 basis point cut’.
  • The US Dollar has not reacted to the dovish comments, so far.

Federal Reserve  dove Evens has repeated much of what we have heard before and said that he wouldn’t mind another rate cut.  

Evans speaking to reports said the following:

  • Wouldn’t mind another cut, but could see either way (assume cut or no cut).
  • Could well be reasons for another 25 basis point cut.
  • Another Fed rate cut would help boost inflation.
  • Earnings help determine business investment outlook.
  • It’s unclear what exactly organic growth of the Fed’s balance sheet looks like.
  • Repo market pressures have subsided, New York Fed daily operations into early November are helpful.

FX implications:  

The US dollar is catching a safe-haven bid regardless of dovish tones from the Fed. However, when its all boiled down, the Dollar can come under pressure again into the meeting towards the end of this month, especially of US data continues to deteriorate between then and now.