Oh no, just when Yellen decided to be fun for once - Forex News by FX Leaders

Oh no, just when Yellen decided to be fun for once

Posted Tuesday, September 6, 2016 by
Skerdian Meta • 1 min read

FED´s Chair Yellen has always been very deterring, but she surprised most market analysts when she made a couple of slightly hawkish comments a little more than a week ago. The forex market took it as a sign for an interest rate hike and the odds for a 25 bps (basis points) hike in September increased to 42% at some point last week.

But the only time poor old Yellen felt a little bit sporty the US economic data turns all sour, going completely against her words. We have had a series of misses since her statement. The manufacturing sector slipped into contraction  and the employment missed the expectations last week. Today the non-manufacturing numbers were way off the expectations on the downside, which also was the worst reading since 2010. That´s a big miss.

EUR/USD shot 100 pips higher after the economic data release

What does that mean for the FED? The recent improvement in the economic data was the reason for Yellen´s hawkish comments. But with what we have seen in the last 7 working days it looks like the situation is making a turn and is now heading down. It wouldn´t be wise to hike the interest rates now unless we see a lot of improvement until the FOMC meeting. The odds of a September rate hike have been slashed to below 30%. Bad luck Yellen strikes again.

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies

About the author

Skerdian Meta // Lead Analyst
Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
Related Articles
During Wednesday's Asian trading hours, the WTI crude oil succeeded in maintaining its previous session bullish rally and drew further bids
22 hours ago
Comments

Leave a Reply

avatar
  Subscribe  
Notify of