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7:16 PM · 21 August 2019

FOMC minutes mixed for the dollar

The most important highlights from FOMC minutes:

  • Most Fed officials viewed cut as a mid-cycle adjustment
  • Fed officials stressed need for fed flexibility
  • Several officials favored keeping rates unchanged
  • Only few bankers expressed concerns about curve inversion
  • Several bankers saw uncertainties about efficiency of QE
  • Bankers said that forward guidance and QE might not be enough to eliminate procrated risks at lower bound

The first statement is very bullish for the greenback, because shows that further cuts are rather uncertain. On the other hand, the last remark mentioned above shows that the Fed is considering new monetary policy tools which may be very supportive for the equity markets (for example ETF buying) oraz negative rates. The dollar was gaining at the beginning, but after a few minutes the dollar is close to the yesterday’s closing.

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