Buz Investors March rate hike The U.S. dollar is higher against most major pairs as the two-day Federal Open Market Committee (FOMC) meeting is expected to bring forth the first U.S. interest rate hike of 2017. The FOMC statement will be released on Wednesday, March 13 at 2:00 pm EDT ( 7:00 pm GMT) with a scheduled press conference from Fed Chair Janet Yellen starting at 2:30 pm. The U.S. central bank is forecasted to hike the benchmark rate 25 basis points at <1.00%.
Fed members were instrumental in changing market perception around the March meeting. Back in February 14 the rate hike probabilities were low but now according to the CME FedWatch tool there is a 93 percent probability the rate is raised on March 15. The Fed is also realizing an update to its economic projections that could give further insight on the pace of the rate hikes anticipated for this year. The market has already priced in a rate hike on Wednesday, but a more hawkish dot-plot upping the tempo to four rate hikes could further boost the greenback.
The European Central Bank (ECB) held rates on Thursday but the rhetoric from President Mario Draghi soothed market anxiety about risks to the end of the euro that have been rising as several elections are set to take place in 2017. A possible discussion of the ECB Governing Council on the topic of hiking rates before the end of the stimulus program appreciated the EUR against the USD on Friday.
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