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20 May 2015
FOMC Meeting: Minutes to sound less dovish – TDS
FXStreet (Barcelona) - FX Strategists at TD Securities preview the FOMC Minutes release ahead, noting the that April meeting data might not be indicative of the prospects of a Fed hike but will likely be seen as less dovish by the markets.
Key Quotes
“The April FOMC Minutes will be the clear highlight of the day and the market will be looking for the extent to which the members see the Q1 growth disappointment as transitory or “in part” due to something more nefarious.”
“We are reluctant to look to the minutes as truly indicative of where prospects lie for a Fed hike, as it is old news and the tone of the data has leaned on the softer side (retail sales, industrial production, surveys for example).”
“We are inclined to think that the minutes will reveal a discussion about a rate hike sometime this year so relative to where the market is priced for the Fed, the minutes should sound less dovish.”
“The Fed has invested a lot of rhetoric over the past several months to talk up policy liftoff in 2015 so reneging on this narrative that early in the year may be a touch premature.”
“As we have said all along, we think it will ultimately come down to the June FOMC meeting before anyone can clearly animate risk around hikes this year.”
“In the meantime, it feels as if FX markets will remain directionless (notwithstanding whippy price action) and we would look to Chair Yellen’s speech this Friday on the economic outlook to provide a more fruitful discussion over policy prospects.”
Key Quotes
“The April FOMC Minutes will be the clear highlight of the day and the market will be looking for the extent to which the members see the Q1 growth disappointment as transitory or “in part” due to something more nefarious.”
“We are reluctant to look to the minutes as truly indicative of where prospects lie for a Fed hike, as it is old news and the tone of the data has leaned on the softer side (retail sales, industrial production, surveys for example).”
“We are inclined to think that the minutes will reveal a discussion about a rate hike sometime this year so relative to where the market is priced for the Fed, the minutes should sound less dovish.”
“The Fed has invested a lot of rhetoric over the past several months to talk up policy liftoff in 2015 so reneging on this narrative that early in the year may be a touch premature.”
“As we have said all along, we think it will ultimately come down to the June FOMC meeting before anyone can clearly animate risk around hikes this year.”
“In the meantime, it feels as if FX markets will remain directionless (notwithstanding whippy price action) and we would look to Chair Yellen’s speech this Friday on the economic outlook to provide a more fruitful discussion over policy prospects.”