Thursday , June 30 2022

The Federal Reserve makes the decision to await the financial world



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Today's decision was in line with the expectations of economists and markets. Recall: markets the price for storing stp unchanged at over 90 percent. The FOMC decision is unanimous.

The last increase in interest occurred after the meeting of 26 September 2018.

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This afternoon we inform: the Fed will win today?

The dollar, afternoon, will win losses after the results of the Congressional election have been announced, indicating the victory of the Democratic Party in the House of Representatives. Session in Asia confirms this trend, and the US currency also gets in the first hours of the European session.

  • "Every time we do that magnificently, he raises interest rates" – so Jerome Povella sums up Donald Trump, adding that although he does not explicitly make a decision on his appointment, but maybe … maybe it will. more "

EUROSTREFA: According to the European Commission, economic growth in the eurozone this year will amount to 2.1 percent, in the future 1.9 percent, and in 2020 it will amount to 1.7 percent. In the Voch case, the EC this year saw an increase of 1.1 percent, in the case of 1.2 percent and 1.3 percent. in 2020, which is a revision of the previous forecast.

Brussels officials see this risk in the form of a growing budget deficit, which is only 1.9% this year. GDP, in the future and 2.9%. Of GDP, and in 2020 it will cut barriers of 3.0%. Of GDP and reached 3.1%. GDP. – that's more than expected from the wax of the government. Voch debt is expected to remain close to 131 percent. GDP in the next years until 2020.

opinion: The yield on 10-year US government bonds (3.22%) is slightly withdrawn, and Vall Street continues to grow. Investors in Europe are, however, much more adventurous – German DAX has slowed slightly, and as a result, it was not possible to test the summit on November 2 to 11,681 points.

The markets, therefore, quickly "transfer" the subject of the election to the Congress that returns to the old subjects. The Fed meeting, which needs to confirm the "positive" attitude of decision-makers on the prospects for further interest rates, can be support for the US currency today.

On the other hand, the issue of the euro remains uncertain about developments in Italy (from the European Commission, it signals that it can initiate proceedings against Rome if it does not amend the draft budget for the next year by November 13). According to yesterday's obedience, the same ECB chief, Mario Draghi, was pushing for Vochnia.

As for the pound, the government is increasingly under pressure to quickly adopt the hill law, although the scenario for Ireland's return is not dominant, and it is still a line of ministers in the British Prime Minister's government. She, according to media speculation, wants first to ensure that her project is supported by the main EU leaders, before she wants to "force" her reception in her own government, which can be held on Saturday.

Therefore, our week is crucial in this topic. If she believes in speculation from the last days, the British will want to adopt at least accounts until November 19 to 21, so they could be presented at a special EU-UK summit on November 27 and 28.

That's exactly what seems to be stopped at the site, which can be an excuse to correct pound growth in the past few days. The theme of the open topic remains American-Chinese trade relations.

However, the market is not focused on today's trade balance data in China and is awaiting rumors related to the sketch of the new trade agreement, which is being prepared by the Trump administration, which will be presented this month to Chiccskis. There is a risk that the other side will not be well received and as a result, a commercial conflict can further escalate (Biai Dom mgbi in this situation will bring another for other products imported from China). At this moment investors are hoping, but they can turn.

On the EUR / USD daily review, it can be seen that the attempt to eject the growth channel was not successful and we made (from now) a return movement. If today's rally closes in the region of 1.1460 or more, then we can count on continuing revenue. Closing in the range of 1.1420-60 and this will mean increasing the likelihood of return to page 1.13 in the next week.

DM BO

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On October 20 we informed: Some bankers want further increase in savings – Fed minutes

Several members of the FOMC believe that it is necessary to continue increasing the interest rates over a long period – according to the minutes from the last meeting of the Federal Reserve.

  • President Donald Trump said in an interview in Fok Business television: "The Fed is my biggest threat" because it raises interest rates too quickly. Trump is increasingly attacking the US central bank, writes Reuters. more "

A gradual approach to increasing interest rates compares the risk of an increase in speed or too slow – says the Fed.

Several FOMC members expect that monetary policy will be moderately restrictive as long as several have estimated that there is a need to temporarily raise interest rates above pre-formed estimates of an increase over the long term in order to reduce the risk of over 2%. inflated goal and avoids significant financial imbalances, "the Federal Bank's report said.

"Estimates of neutral interest rates will be just one of the many factors that FOMC takes into account when deciding on monetary policy," he added.

Bankers unanimously decided to increase interest rates at the meeting.

"All bankers expressed the view that the Committee should continue its gradual approach to the unification of monetary policy by increasing the 25 bp share of the meeting," the report said.

– Almost all members of the FOMC considered it appropriate to remove the statement in this position after the meeting of the Committee that "monetary policy remains appropriate," the bankers said.

A neutral level discussion does not dominate the FOMC meeting.

"Estimates of neutral interest rates will be just one of the many factors that FOMC takes into account when deciding on monetary policy," he wrote.

According to bankers, great attention should be paid to the possible elimination of the yield curve of US government risks and high risk loans as potential factors that could lead to a recession.

"Several bankers pay attention to the structure of interest rates and potential inversion of the bond yield curve could project into economic prospects, since inverting in the past usually precedes the beginning of a recession in the US," he wrote.

"Some participants of the meeting pointed out that such risks should continue with financial stability as a continuous increase in the number of risky loans (…) as well as an increase in activities in the non-banking sector" – he added in the "minutes".

Markets respond negatively to the FOMC meeting minutes – the dollar is strengthening against the basket of currencies by 0.5%. to 95.53 points, and the yield on 10-year US bonds increased by 1bp. to 3.18%.

The US federal reserve increases the main interest rate by 25 bps at the boiling point. to 2.0-2.25 percent. It was in the cycle, started in December 2015, and the third in 2018 will increase the funds raised.

The Fed has removed the definition of monetary policy as "flexible", but during a conference after the meeting, Fed chairman Jerome Povell said the monetary policy of the Federal Reserve could still be described as "flexible." Paule will then assess, the US economy is "strong", and customs issues do not affect his condition.

In addition to eliminating the definition of monetary policy as flexible, the Fed will not introduce changes in the message. Feders from the Fed kept their forecasts for four increases during 2018 and three more in 2019.

"The labor market continues to grow, and activity in the economy grows rapidly," the Federal Reserve estimates.

"In the past few months, the average increase in jobs would be robust, and the unemployment rate will remain low," he added.

US GDP in the second quarter of 2018 increased by 4.2 percent. in an unclassified version (SAAR) kdk. This is the largest quarterly reading since 2014. The next meeting of the Reserve will be held on November 7 and 8.

From January 2019, a press conference will be held after each meeting of the Federal Fund. So far, press conferences have been held at each other reservation meeting. The frequency of publishing macro projections will be maintained (quarterly).

Inflation, unemployment, GDP – see data from Poland and the world in Business INTERIA.PL

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