USD higher after “patient” FOMC; Bank of England meeting

Market Recap

USD initially lost ground following the FOMC meeting, but jumped higher after Fed Chair Powell’s press conference. He refused repeatedly to be drawn into a discussion on possible scenarios in which the Fed might cut rates, instead repeatedly referring to the “transient” nature of recent inflation weakness and stressing that the Fed is sticking with its “patient” stance of keeping rates steady as it watches the incoming data. “Our baseline view remains that, with a strong job market and continued growth, inflation will return to 2% over time and then be roughly symmetric around our longer-term objective,” he said. That would mean no reason to cut rates now.

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