Dollar slips from four-month high, awaits fresh catalysts after Fed

Dollar slips from four-month high, awaits fresh catalysts after Fed

USA stocks traded lower on Wednesday, as investors evaluated the Federal Reserve's decision to keep monetary policy on hold.

The FOMC's two-day meeting followed the release of data Monday that showed inflation measured by the central bank's preferred gauge had hit its 2 per cent target after being below that goal for nearly every month since April 2012.

The European Commission will present its spring economic forecasts, including growth, inflation, debt and deficit projections.

The Fed's preferred Personal Consumption Expenditures price index hit the central bank's two-percent target in March for the first time in almost a year, while "core" PCE inflation, which excludes volatile food and energy prices, was 1.9 percent.

Stocks end lower as Fed maintains status quo.

The dollar fell sharply against basket of other currencies but quickly reversed course, rising to a new high for the year. Treasury 10-year yields pushed up to 2.99%.

Here are the key takeaways from the policy meet of the Federal Open Market Committee.

And RDQ Economics said the wording changes looked like "a signal that the Fed is not likely to react in a hawkish manner to inflation moving above 2 percent".

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Goods include sweetcorn and cranberries, along with Kentucky bourbon, cigars, jeans and motorcycles. It has also reached an agreement in principal with Argentina, Brazil and Australia.

"Inflation on a 12-month basis is expected to run near the committee's symmetric 2% objective over the medium term", the Fed said.

3-4 rate hikes Fed officials in the March meeting had indicated that they expected a total of 3-4 hikes in 2018.

Since the Fed began raising rates in December 2015, the pace has been modest and gradual: One quarter-point rate increase in 2015, one in 2016, three in 2017 and one so far this year. It added that risks to the outlook appear roughly balanced, removing a previous reference to "near-term risks".

The Fed's decision to leave its benchmark overnight lending rate in a target range of between 1.50 percent and 1.75 percent was unanimous.

Payroll gains in the USA probably picked up in April, with the unemployment rate forecast to drop to 4 per cent, according to surveys of economists before the data reports due Friday.

The Fed also said while growth of household spending moderated from its "strong fourth-quarter pace, business fixed investment continued to grow strongly". The Australian dollar was up to 0.7524 dollar from 0.7491 dollar.

Those who voted were Jerome Powell, Chairman; William Dudley, Vice-Chairman; Thomas Barkin; Raphael Bostic; Lael Brainard; Loretta Mester; Randal Quarles and John Williams.

The US Federal Reserve revised its outlook for inflation Wednesday, after its long-undershot goal of a 2% annual rate was met in the government's latest economic data. Investors had all but ruled out another increase at this week's meeting.

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