18 Feb 2015
GBP/USD: bid over 60 pips on the back of a neutral FOMC
FXStreet (Guatemala) - GBP/USD is currently on the bid post the neutral minutes from the FOMC, trading at 1.5470 with a high of 1.5477 and a low of 1.5340.
There has not been huge reaction to the less than hawkish minutes this time around, with US equities slightly higher after the minutes due to rates likely to remain on hold until at least the middle or end of 2015 given the language within the minutes.
Many participants at the meeting were in favour of holding rates for the mean time, although there had been some discussion with some members looking for action sooner. The labour market still has room for improvement and they are needing more evidence of inflation on the rise. There were concerns over a stronger dollar that could slow the economy. Oil prices are a plus while the global environment is a concern, especially in China. So from here on, we are still in data dependency mode and the FOMC are mindful of the type of language used such as removing the word "patient", and if doing so, they are signalling that rates will rise in the next couple of meetings.
There has not been huge reaction to the less than hawkish minutes this time around, with US equities slightly higher after the minutes due to rates likely to remain on hold until at least the middle or end of 2015 given the language within the minutes.
Many participants at the meeting were in favour of holding rates for the mean time, although there had been some discussion with some members looking for action sooner. The labour market still has room for improvement and they are needing more evidence of inflation on the rise. There were concerns over a stronger dollar that could slow the economy. Oil prices are a plus while the global environment is a concern, especially in China. So from here on, we are still in data dependency mode and the FOMC are mindful of the type of language used such as removing the word "patient", and if doing so, they are signalling that rates will rise in the next couple of meetings.