19 Jun 2014
USD extends downside post-Fed - BTMU
FXStreet (Barcelona) - Lee Hardman, FX Analyst at the Bank of Tokyo Mitsubishi UFJ, observes the USD is tarding on the back footing following the dovish tone from the FOMC.
Key Quotes
"The US dollar has weakened modestly overnight following yesterday’s FOMC meeting with USD/JPY falling back below the 102.00-level. The US dollar has been undermined by the pullback in US yields reflecting the more dovish than expected assessment of the FOMC meeting."
"The 10-year US Treasury bond yield has fallen back below 2.6% although remains well above its recent low of 2.40% recorded in May. The FOMC statement presented a more upbeat outlook for growth describing activity as having rebounded in recent months, and that labour market indicators have generally showed further improvement."
"The Fed also acknowledged that business fixed investment has resumed its advance. However, there was no change to their assessment of inflation developments despite stronger than expected readings so far in 2014. In these circumstances, the Fed decided to taper QE by a further USD10 billion reducing monthly asset purchases to USD35 billion/month, while reiterating that it does not intend to raise the fed funds rate for a considerable time after the end of QE."
Key Quotes
"The US dollar has weakened modestly overnight following yesterday’s FOMC meeting with USD/JPY falling back below the 102.00-level. The US dollar has been undermined by the pullback in US yields reflecting the more dovish than expected assessment of the FOMC meeting."
"The 10-year US Treasury bond yield has fallen back below 2.6% although remains well above its recent low of 2.40% recorded in May. The FOMC statement presented a more upbeat outlook for growth describing activity as having rebounded in recent months, and that labour market indicators have generally showed further improvement."
"The Fed also acknowledged that business fixed investment has resumed its advance. However, there was no change to their assessment of inflation developments despite stronger than expected readings so far in 2014. In these circumstances, the Fed decided to taper QE by a further USD10 billion reducing monthly asset purchases to USD35 billion/month, while reiterating that it does not intend to raise the fed funds rate for a considerable time after the end of QE."