Stephen Innes, senior trader at OANDA, is very cautious:
As the December rate hike probabilities are all but entirely price-subscribed, it comes down to a call on the future pace of interest rate hikes (dot plots) that the Fed projects for 2017. A more aggressive Fed lean will see the USD rocket higher, and while a less aggressive tack will not necessary spoil the party, it will certainly stall dollar momentum. Realistically, I cannot see how the Chairperson would not be anything but cautious, as the US and global economies shift from a world of accommodative monetary policy excess to one of fiscal indulgence. So let’s not bring out the party hats just yet.
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