A surprisingly dovish FOMC policy decision dragged the Greenback across the board last week. Will Powell and his gang provide more insight this week?
FOMC member speeches
Voting FOMC members will have a chance to share their two cents when some of them take center stage over the next couple of days.
If you recall, the Fed surprisingly turned less hawkish when it removed references to gradual rate hikes and replaced it with being “patient as it determines what future adjustments to the target range” will be.
This week, we might get hints of how (un)enthusiastic about further rate hikes some of the voting members are. Here’s a list of the members’ scheduled speeches:
- Randal Quarles (Feb 7, 12:05 am GMT)
- Governor Jerome Powell (Feb 7, 1:00 am GMT)
- Richard Clarida (Feb 7, 3:30 pm GMT)
- James Bullard (Feb 8, 1:30 am GMT)
In his presser last week, Powell expressed his confidence in the economy and inflation. It’s just that “cross-currents” like the U.S.’ spending budget this year, Brexit negotiations, and the U.S.-China trade war are marking it difficult to justify interest rate hikes in the foreseeable future.
Watch the newswires closely in case we see relevant themes from this week’s FOMC speeches!
U.S. international relations
Now that the U.S. NFP report and FOMC statement are behind us, focus will likely turn back to the government’s dealings with its economic partners and competitors.
U.S. and Chinese reps are still busy hammering out details and National Economic Advisor Larry Kudlow shared that the talks had a “good vibe” going around even as the participants aren’t quite ready to write anything on paper.
Word around is that Trump and Xi Jinping will meet just before the March 1 trade truce deadline to see how the world’s biggest economies will proceed with the trade war. That’s in less than a month, yo!
Meanwhile, crude oil prices could see more volatility depending on how the U.S. wants to follow up with its latest sanctions and how Venezuela will react to them.
If tensions rise further and we see more threats and sanctions fly around our news screens, then we could see risk aversion across the board and higher prices for crude oil.
Missed last week’s price action? Read USD’s price recap for Jan. 28 – Feb. 1!