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The Federal Reserve in the United States can take the approach to waiting and seeing, given the uncertainty surrounding American policy. It is clear that Donald Trump now determines the conditions of financial markets, instead of the central bank. Let’s discuss this topic and develop a trading plan for Euusud husband.
The article covers the following topics:
Main meals
- The Federal Reserve decided to maintain 4.25-4.5 % rates.
- The US Central Bank calls for a balanced approach.
- US policy puts pressure on the US dollar.
- Think about buying an Eurusd pair during a recovery of 1.124 and 1.118.
The basic expectations of the US dollar
The Federal Reserve is no longer seen as the final power. At the May FOMC meeting, Jerome Powell emphasized the “Wait and See” approach, using the phrase 11 times. This negative position is largely due to the uncertainty regarding the policies of the American administration. Donald Trump’s effect on financial markets is clear, especially in Euusud The husband’s reaction to the decision to maintain the rate of federal funds by 4.5 %.
Federal funds performance
Source: Wall Street Journal.
In the period before the Federal Reserve meeting, there was great speculation about Forex that the central bank would adopt a preventive approach. If unemployment mutations, interest rates may decrease. Analysts conducted comparisons in 2019, when the Federal Reserve has implemented three rounds of cash expansion during the trade war between the United States of China as a precaution. However, Jerome Powell rejected these aspects of similarities, noting that inflation levels are much higher.
The Federal Reserve Chair stressed the importance of the balanced approach within its double mandate, stressing that large climbing climbing or unemployment must be addressed immediately. As the economy remains strong, the Federal Reserve Province can stop its actions at the present time. Consequently, the derivative market reduced the possibility of a fourth round of cash expansion in 2025 from 40 % to 36 %.
Federal funds expectations expectations
Source: Wall Street Journal.
The Federal Reserve Chair stressed the importance of the balanced approach, especially since American protectionism puts the way due to the difference in monetary policy. The Federal Reserve increasingly warns of potential inflationary pressures arising from the definitions, while central banks in other countries focus more on stimulating economic growth. These banks may need to reduce prices more virtually than the Federal Reserve Bank, which, in theory, must enhance the US dollar. This may be true in theory, but the reality tells a different story.
Donald Trump’s focus on reducing the US trade deficit negatively affects the expense of capital, which leads to the flow of money from the United States and indulging in the US dollar index. Asian countries, which have accumulated American assets from large trade surpluses, are now selling. As a result, Eurizon Slj Capital estimates that $ 2.5 trillion can return to the United States, which paves the way for a possible transfer in Euusud husband.
At the same time, the strengthening of other currencies against Greenback helps Donald Trump addressing competitiveness issues and reducing trade deficit by stimulating exports.
Erusud weekly trading plan
The White House needs a weaker currency and will not give up its plans to reform the international trading system, which presses the US dollar. The possibility of the negative aspect of Euusud The husband looks limited. Therefore, if the price recovery from support levels of 1,124 and 1118, consider closing Short deals It started at 1.1325 and turned into long sites.
This expectation depends on an analysis Basic factorsIncluding official data from financial institutions and organizers, various geopolitical and economic developments, and statistical data. Historical market data is also.
Eurusd price scheme in the actual time
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of the Litefinance Mediator. The materials published on this page are provided for media purposes only and should not be considered to be considered investment advice for guidance purposes 2014/65/European Union.
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