Bank of America Merrill Lynch Research are discussing their expectations for the Fed’s interest rate decision today at 21:00 local time.
“As is widely expected, we believe the FOMC will not take measures with regard to monetary policy and will keep interest rates unchanged.” The Fed will also make a balanced statement on the economy.
“More aggressive / hawkish / tone during the statement will bring additional support to the dollar .. FOMC’s decisions tend to support the greenback.In the last year, the dollar index was 8 times up and 0 times down during the statements. Interestingly, the current price action signal measured over the past 20 days is about 90% correlated with the decision in April 2018, after which DXY jumped by nearly 3% next month.
Moreover, the USD remains strong and the volatility low. This combination supports the opinion of the dollar in the short term, “commented BofAML.
Trader Aleksandar Kumanov