FOMC meeting seen cautious albeit USD-supportive – Danske Bank

Analyst at Danske Bank Kristoffer Lomholt sees the FOMC keeping its cautious stance albeit the statement could come in on the hawkish side.

Key Quotes

“The key event today is the July FOMC monetary policy meeting in the US. The meeting is a small one in the sense that we will not get new ‘dots’, revised projections or a press conference”.

“As it is widely expected that the FOMC will keep the federal funds target range unchanged at 0.25-0.50%, focus will be on the released statement”.

“Even though financial markets have taken Brexit calmly and the US equity markets are close to record highs, we expect the FOMC to take a cautious stance due to possible negative spill-over effects of Brexit uncertainties. Still, risk is tilted towards a more hawkish message given the strong rebound in US data in Q2”.