A quick glance at today’s FOMC meeting

In spite of the recent surprisingly good economic data from the US that has improved a lot since the slouch of positivity that was seen last summer, there is still some optimism that the Fed will at least signal the readiness to ease policy further. In recent statements the FOMC board seem to be more dovish than they once were, this backs up the view that the Fed will sway towards a further easing of monetary policy. Today traders will be listening closely as the Fed are expected to release their funds rate forecast for the next 18 months, it is expected that they will show that rates will remain low for longer than investors first thought. Traders will also be listening out for signs that the Fed will accompany this with signs of more QE. The recent ‘risk on’ markets have been aided by speculation of this. So if the Fed fail to live up to what participants expect or have priced in then we could see riskier asset classes hand back some of their recent gains.