Will the FOMC drop ‘patient’ from the statement?
City Index March 18, 2015 1:25 PM
<p>The pound is set for a popular day, with data releases throughout affecting the GBP/USD. We start off early this morning with average earnings expecting to […]</p>
The pound is set for a popular day, with data releases throughout affecting the GBP/USD. We start off early this morning with average earnings expecting to rise to 2.2% from 2.1%, which is key to a rate rise being on the table if we see more of an increase.
The MPC votes will be in as well with no change expected at 0-0-9. This will show a unanimous decisions to hold rates, in addition to a unanimous vote to keep asset purchases at the same levels, 0-0-9.
To finish off the morning data the unemployment rate is expecting to fall from 5.7% to 5.6%, so in expectations we should be seeing a confident pound – however, yesterday proved a tough day as it fell from highs of 1.4840, as we await the data this morning. The annual budget is also to be released today so will likely keep the GBP on its toes for any announcements.
The FOMC statement and federal funds rate is to be released later tonight, and with the rate due to stay the same we look towards the comments from the FOMC and mainly the anticipated drop of ‘patient’ in the text. If, as excepted, this comes off it means we could be only a matter of months away from the first rate lift in the US. This could signal a very volatile time for the USD during this period.
Supports 1.0550-1.0500-1.0450 | Resistance 1.0650-1.0700-1.0750
Supports 121.15-120.90-120.70 | Resistance 121.55-121.75-121.95
Supports 1.4700-1.4650-1.4575 | Resistance 1.4820-1.4900-1.4950
GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.