EUR/USD Reacting Calmly on Fed Decision: Market Review, 27.09.2018

The EUR/USD is calm for the second day in a row, trading at around 1.1747. The investors did not get any new information, except for the news that a fourth rate hike is still scheduled for this yer.

The 2-day FOMC meeting ended without any surprise, as the interest rate was raised by 25 basic points to reach the target range of 2%-2.25%. The macroeconomic report that came afterwards says the Fed is going to hike the rates once more in 2018, which is quite positive for the US dollar.

The economic growth outlook provided by Fed is also positive. The GDP in 2018 is going to rise by 3%-3.20%, with the previous reading saying 2.70% to 3%. In 2019, the economy is expected to rise by 2.40% to 2.70%, against 2.20%-2.60% previously. 2020 readings are also better than previously. Meanwhile, the inflation readings have not changed, as the Fed is expecting the CPI to rise by 2% in 2018, 2.10% in 2019, and 2.20% in 2020.

As per the QE, the meeting minutes show the stimulus measures are coming to an end, as the Fed is returning to its pre-2008 monetary policy with no low rates. Both Ben Bernanke and Janet Yellen can be happy now, as Jerome Powell has successfully completed the complicated process they initiated and implemented.