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Fed. Says Raise Interest Rates Again "Fairly Soon"

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USD
According to FOMC’s meeting minutes released yesterday, it may be appropriate to raise interest rates again "fairly soon" should jobs and inflation data come in line with expectations.

The minutes also reflected uncertainty among the Fed policymakers on the impact of Trump administration’s new economic program; as participants emphasized on the need to wait for some time to get a clearer outlook.

Fed Chairman, Janet Yellen had previously mentioned last week, that waiting too long to raise interest rates again would negatively impact the economy on the long run.

In addition, the participants did not fully discuss the need to decrease the $4.5 trillion balance sheet; instead they agreed to postpone discussion till the next meeting.

The U.S. dollar index fell to 101.15 amid uncertainty over U.S. policy.

Gold
Gold settled at around $1,237 yesterday after releasing the minutes of the Federal Reserve's most recent policy meeting. The yellow metal is expected to trade sideways between $1,231 and $1,241 towards the end of the week.

Euro
Euro pared its losses vs. dollar after reaching a 6-week low, as the polls went against France's far-right leader Marine Le Pen after French centrist Francois Bayrou said he was offering an alliance with independent candidate Emmanuel Macron.

The EUR rose to $1.0570 vs. USD and is expected to rise further and open the week at around the level of $1.0615.

GBP
The UK economy grew more than previously estimated in Q4 2016. However, the Sterling pound pared its gains vs. the Greenback as data showed a decline in UK business activity and consumer spending.

Oil
Oil prices failed to maintain its gains, achieved earlier this week, due to expectations of another rise in U.S. inventories, and the statement of Qatar’s Minister of Energy.

The most important economic events:

  • USD DOE U.S. Crude Oil Inventories (FEB 17): (GMT: 16:00) – medium – Forecast (N/A) – Previous (9527k).

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