USD Declines as Fed Minutes Reiterate Dovish Shift in Outlook
- Markets mull over the Federal Reserve’s FOMC December 18-19 meeting minutes deliberating the weight it still carries after recent market developments
- A data dependent Fed has turned increasingly cautious over its path to normalization due to deteriorating fundamentals and tightened financial market conditions
- The minutes are released following recent dovish remarks from several key Fed officials causing the USD to drop
Fed ‘can afford to be patient’ about future rate hikes, FOMC minutes show
- Federal Reserve officials acknowledged that the policy path ahead is “less clear” after approving an interest rate hike at their December meeting.
- Minutes released from the meeting showed the rate hike came with reluctance from a few members who thought the lack of inflationary pressures argued against another increase.
Where will the USD go? What does our technical chart saying?
With the prospect of future rate hikes quickly vanishing from the minds of market participants with the dovish drumbeat growing louder, we expect US to head the next support.
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