The ruble did not respond to the last fed meeting
Yesterday’s meeting of the U.S. Federal reserve, which, as expected, the key interest rate was raised by 0.25 percentage points was no event (status event without the expected resonance).
U.S. stock indexes habitually went to light the negative, and the dollar’s rally did not take place. The fed reiterated that it plans to “further gradual increase” of its base rates and kept its forecast for the fourth rate hike this year and another three in 2019. Fed officials expect that by the end of this year, the key interest rate will rise to 2.4% at the end of 2019 – to 3.1%, and at the end of 2020 is 3.4%.
What is it that is so wicked markets, the head of the fed Jerome Powell?
Amid the diversity of opinions of analysts and economists of all types, fancy autumn carpet rasselivsheesya in the media space, two voices and was quoted in online editions more often. First, the Federal reserve, abandoning the phrase “accommodative policy” (expansionary monetary policies) suddenly announced that the removal of this phrase from the statement does not mean the actual elimination of the positions of need for further stimulus and support. At best, it is a euphemism, at worst wickedness, that in any case the markets would love.
Second, the fed failed to clearly answer several times insistently sounding question – does the Federal reserve in its economic forecasts the non-standard situation of trade wars, and whether the risk of a recession in this context, despite the usual verbal labels of “strong economy” and “almost full employment in the labour market”. In short, although the fed is aggressively forced to speak “intelligible, intelligible to the broad language of the masses” and to be more open to investors in terms of discussing their decisions and actions – in fact, obviously, this is not happening. The market is increasingly responding with skepticism and, I may say, trolling.
In addition, the “bad taste” left in the context, the more persistent the comments of the President of trump regarding the actions of his appointee. Donald trump again publicly protested the rate hike by the fed, claiming that they inhibit rapid economic growth, which he promised to voters. This Powell responded in the way that the fed has traditionally not guided by “political factors or things like that”. As they say, and went on.
Meanwhile, today’s busy schedule of publications of the macroeconomic data across the USA, including such important indicators as GDP in the third reading (recall that the previous version of this indicator was significantly improved to 4.2%) and foreign trade balance of the United States, which may again disappoint. Thus, trump’s correspondence dispute with Powell, may find his unexpected inanimate impartial judge.
Against this background, no event of emerging market currencies, including the ruble, decided to continue to trade sideways, as if continuing to prepare for something important. Perhaps the aforementioned statistics will be able to interrupt a strange numb and to break the long status quo. As of 13:00 Moscow time the ruble remains at 65,80 to the dollar, and of 77.04 ruble per Euro.
“International financial center”