Arab Today, arab today markets on edge for fed plans on rate hike
Last Updated : GMT 02:32:13
Arab Today, arab today
Arab Today, arab today

Markets on edge for Fed plans on rate hike

Arab Today, arab today

Arab Today, arab today Markets on edge for Fed plans on rate hike

Currency and bond markets
Washington - AFP

Currency and bond markets were on edge Wednesday ahead of the outcome of the Federal Reserve's policy meeting, expected to make clearer plans for a possibly midyear interest rate increase.
Most analysts believe the Federal Open Market Committee's policy statement, to be released at 1800 GMT, will drop its insistence that it "can be patient" before increasing the federal funds rate, the benchmark that has sat at zero for more than six years to pull the economy back from crisis.
That phrase has stood between FOMC policymakers' caution and firm commitment to take the step for a rate increase this year.
Fed Chair Janet Yellen has said several times that removing that phrase would signal a possible rate increase within two or more FOMC meetings, which would point to June at the earliest. And since last year, FOMC projections have pointed to the rate liftoff around the middle of the year.
The move would confirm the stark divergence between US monetary policy and that of other central banks around the world. With the US economy growing solidly, the Fed is clearly on a tightening path, heading toward policy "normalization" after being on a crisis footing since 2008.
Meanwhile central banks in Europe, Japan, China, and a host of next-level economies are easing, pumping out more easy money to fend off recession and deflation.
The consequences of divergence have been challenging on all sides. The dollar has surged about 20 percent against a trade-weighted basket of currencies in one year. Against the euro, it has soared 32 percent; against the yen, 18 percent.
That has made exporters to the US more competitive but raised the price of crude oil they import; it has hiked the cost of capital -- dollars -- needed by developing countries and sucked investment funds from foreign markets toward the United States.
It has also left markets far more volatile and unpredictable.
What the FOMC statement, its projections, and Yellen, in a post-meeting press conference, say about the path forward for rates could either calm or boost that volatility.
Even if an initial fed funds rate increase is confirmed for the coming months, how aggressive or cautious the FOMC will be in further rate increases is the focus of Fed analysts.
"It is not only the language around 'patience' that matters for rates and the dollar," said Nomura analysts in a research note.
"As we get closer and closer to liftoff...  the Fed's projections for the economy and rates should have a more powerful signaling effect."
Given the still-frail state of the global economy elsewhere, some say the FOMC should remain patient.
"Lower oil prices and the appreciation of the dollar make it appropriate for the Federal Reserve to wait longer to raise policy interest rates," the Organisation for Economic Co-operation and Development said in its global outlook earlier Wednesday.
But most expectations are that "patience" will be gone.
Having built up market expectations over the past six months, "the Fed will not try to upset the apple cart," said Societe Generale.
"The Fed will basically try to slip in the message of incoming rate hikes as delicately as possible without upsetting the market too much."

 

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today markets on edge for fed plans on rate hike Arab Today, arab today markets on edge for fed plans on rate hike

 



Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today markets on edge for fed plans on rate hike Arab Today, arab today markets on edge for fed plans on rate hike

 



Arab Today, arab today
Arab Today, arab today Youssra depended on colored foam

GMT 16:53 2017 Tuesday ,05 September

Youssra depended on colored foam
Arab Today, arab today Taxi! Transport gets an overhaul

GMT 12:09 2017 Sunday ,24 September

Taxi! Transport gets an overhaul
Arab Today, arab today Etiquette expert underlines importance of gifts

GMT 17:52 2017 Sunday ,03 September

Etiquette expert underlines importance of gifts
Arab Today, arab today Turkey warns of 'security' steps

GMT 12:17 2017 Sunday ,24 September

Turkey warns of 'security' steps
Arab Today, arab today North Korea 'more opaque'

GMT 10:50 2017 Sunday ,24 September

North Korea 'more opaque'
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Ministry seeks to improve education

GMT 14:49 2017 Sunday ,17 September

Ministry seeks to improve education
Arab Today, arab today 'Lady Beast' fights for girl gamers

GMT 10:27 2017 Sunday ,24 September

'Lady Beast' fights for girl gamers
Arab Today, arab today Psychologists help Mexico deal

GMT 05:05 2017 Sunday ,24 September

Psychologists help Mexico deal
Arab Today, arab today The history of solar eclipses

GMT 05:16 2017 Sunday ,20 August

The history of solar eclipses
Arab Today, arab today Third generation adds more power

GMT 13:40 2017 Sunday ,24 September

Third generation adds more power
Arab Today, arab today Carmakers face billions in European

GMT 12:37 2017 Saturday ,23 September

Carmakers face billions in European
Arab Today, arab today Lebleba is preoccupied in filming 'Back Street'

GMT 08:56 2017 Thursday ,21 September

Lebleba is preoccupied in filming 'Back Street'
Arab Today, arab today Big Western brands polluting oceans

GMT 20:10 2017 Saturday ,23 September

Big Western brands polluting oceans

GMT 08:59 2017 Wednesday ,20 September

Youssra prepares for launching her program

GMT 10:16 2017 Friday ,22 September

All eyes on May as she prepares

GMT 16:53 2017 Saturday ,02 September

Mai importance of gifts during Eid Al-Adha

GMT 12:01 2017 Wednesday ,20 September

Puerto Rico, Virgin Islands brace

GMT 10:46 2017 Saturday ,05 August

Nanis reveals simple ideas for home renovation

GMT 18:11 2017 Saturday ,23 September

Doctor provides advices to families

GMT 13:36 2017 Saturday ,23 September

unveils Joon - the 'millenials' airline

GMT 17:12 2017 Monday ,07 August

Al-Shawaifi reveals secrets of total solar eclipse

GMT 12:46 2017 Thursday ,21 September

Google likely to buy stake in Taiwan smartphone maker HTC

GMT 11:37 2017 Saturday ,12 August

Fashion designer reveals her new collection
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday