Potential reactions in G3 on today’s FOMC decision – Danske Bank
FXStreet (Edinburgh) – Analyst at Danske Bank Mikael Milhoj assesses the probable scenarios for the G3 in light of today’s FOMC meeting.
Key Quotes
“We stress that while the US economy should be ready for it, the Fed is not geared up to deliver the first rate hike this week in our view: no hike today and lower ‘dots’ will guide the initial reaction in EUR/USD and send the cross higher near term”.
“The JPY is less likely to strengthen relative to the EUR against the USD on a softer Fed, whereas USD/JPY upside potential remains high in the event of a Fed rate hike due to a neutral positioning”.
“GBP/USD clearly stands out among the G3s with relatively low betas on both relative rates and risk. As such, the cross should react asymmetrically to the Fed and thus move lower on a Fed hike”.
Analyst at Danske Bank Mikael Milhoj assesses the probable scenarios for the G3 in light of today’s FOMC meeting…
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