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Money Flows for the European trading session
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Loading...The futures on the main stock indices remained broadly unchanged. The economic calendar for the session remains without major catalysts, with the only exceptions being made by Fed statements, inflation data in Europe and building permits in the United States.
But silence should not deceive us. However, they draw attention to two interesting days - the traders focus their attention on the widely anticipated two-day Fed meeting that begins today.
Tomorrow, the FOMC will decide on the interest rates in the country and will have a press conference on Jerome Powell afterwards.
The Fed will also publish a dot plot forecast as well as expectations for inflation, growth and employment. Markets cut their expectations for interest rates this week to 21%, but for July they remained at 85.5%.
The comment at the press conference of J. Powell will be the Fed's great opportunity at least to justify the idea of being ready to release the fiscal position in the country.
For the sake of ease, inflation is either still transient (as expressed at the FOMC meeting in May), or just does not get higher and the expectations for slower growth as a result of tariffs. Therefore, the Federal Reserve has the potential to allow the economy to continue to develop. The waiting factors are that retail sales and industrial production last week are quite good, and although employment declined in May, general employment conditions remain strong.
At 85%, the market forces / expects the Fed to act. If not, the dollar has plenty of room for promotion.
Other central bankers will meet this week, including BOE and BOJ. For BOE there are some MPCs that hint for promotion. Michael Saunders pointed out that he did not have to wait for Brexit before raising interest rates. Chief economist Andy Haldane said the moment when inflationary pressure is on the rise.
The central bank of Japan will also meet - no changes to monetary policy are expected (again).
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