Fed holds rates steady, signaled readiness to adjust balance sheet normalization

The U.S. Fed maintained their dovish stance and noted they are prepared to adjust balance-sheet normalization. As expected they kept rates steady and reiterated their pledge to be patient.

Regarding the economy, the Fed noted the labor market continued to strengthen and that economic activity has been rising at a solid rate.

The US dollar fell across the board against all its major trading partners. The immediate reaction for interest rate probabilities following the release of the statement roughly saw expectations rise about 1% for each meeting, but still not fully pricing in a hike in 2019.

 

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Ed Moya

Ed Moya

Senior Market Analyst, The Americas at OANDA
With more than 20 years’ trading experience, Ed Moya is a senior market analyst with OANDA, producing up-to-the-minute intermarket analysis, coverage of geopolitical events, central bank policies and market reaction to corporate news. His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies. Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Most recently he worked with TradeTheNews.com, where he provided market analysis on economic data and corporate news. Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business and Sky TV. His views are trusted by the world’s most renowned global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Breitbart, The New York Times and The Wall Street Journal. Ed holds a BA in Economics from Rutgers University.
Ed Moya