Markets on Thursday: USD Holds as the Fed Tightens
Rowan Crosby • 1 min read
Wall Street knew what was coming and the interesting part was that no one knew how markets would react.
Sure enough, interest rates got raised in the US and it appears the takeaway from the FOMC was that the period of accommodative monetary policy is over. As the Fed looks to continue to tighten into both 2019 and 2020.
That was the real question prior to yesterday’s Fed meeting. We didn’t know how aggressive they were going to be looking forward. It appears they are happy to stay the case.
US equities weakened on the news, while gold and the energies also fell away.
The USD Outlook
The DXY jumped around a little bit on the FOMC release but for now, is still holding above the support level at 94.00. With 93.80 now being the bottom of this range we are in and 94.50.
In reality, any spike to 94.40 has been getting sold off so that is probably a good spot to play this range at the moment.
Just like the FOMC meeting, we haven’t probably learnt a heck of a lot more about the USD post-meeting. So this one is looking like we might have to wait for the break of the range to try and play the right direction.