Wednesday, October 30, 2019

IMPORTANT: Fed Interest Rate Decision

Today, the Federal Open Market Committee (FOMC) will be concluding its two-day meeting, this is followed by a press conference where the interest rate decision will be announced.


The EUR/USD is trading choppy above 1.11, and Asian equities are facing moderate selling pressure after an upbeat US GDP and ahead of what the market is expecting to be a hawkish Fed sentiment. 


The positive comments from the US GDP is likely to be overshadowed as the US central bank is expected to cut rates by 25 basis points on Wednesday, and to signal a pause in the easing cycle, the market has already priced in the 25 basis point cut.


A cut would be the first cut since the 2008 financial crisis, and therefore holds significance. So if the Fed delivers as expected, the statement and Powell’s words will be watched closely for clues about the future, however, there is a 16% chance of a larger rate cut.


The US Dollar has been rising since last week, particularly as market participants previously dampened rate cut expectations. A break lower than the critical resistance at 1.1100 could leave the pair vulnerable to a sharp drop, possible to around 1.1000.


Due to the significance of today’s decision, this event is likely to cause volatility in USD related pairs and US Stocks, which can led to new trends and excellent trading opportunities, and therefore we recommend that all traders be prepared.


To learn more, feel free to contact the Yadix live support team.

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