Yesterday, the Fed decided to increase interest rates by 25bps as was widely anticipated, while the new “dot plot” pointed to a 4thhike by the end of the year. As for today, the ECB takes its turn. Following hints that the Bank may decide on QE today, investors will be sitting on the edge of their seats for any announcement on that front. Tonight, the BoJ also decides on policy, but no fireworks are expected.
Fed Delivers its 2ndHike in 2018; Signals a 4thby Year End
The dollar ended the day lower against all but one of the other G10 currencies. It underperformed the most against EUR, NOK and SEK, while it managed to gain somewhat against AUD.
Yesterday, the highlight was the FOMC policy decision. As was widely anticipated, the Committee raised the federal funds rate by 25bps, to the 1.75-2% range. Given that the hike was already priced in, the market quickly turned its attention to the accompanying statement...
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