The Fed: how to find peace of heart? Overview for 16.03.2022

EURUSD is consolidating and waiting for the March meeting of the US Fed to be over. 

The major currency pair slowed down its growth and is currently waiting for news. The latest quote for the instrument is 1.0997.

The two-day meeting of the US Fed is scheduled to be over later today. It’s hard to overestimate its importance: the regulator is ready to start a new cycle of monetary policy tightening but market players could use some details. 

Average market expectations imply a 25-point hike, and the actual reading won’t be too far from zero. There is a more aggressive scenario, a 50-point hike in March, but it is directly influenced by how the Fed sees current inflation and its prospects. 

This new cycle of monetary policy tightening brings nothing really positive for the “greenback”. However, there are nuances, as always: eventually, the USD might continue being strong for a longer period of time, because investors will surely like the FOMC’s “hawkish” tone and higher inflation risks. 

All important things will be revealed during the Fed press conference, which is scheduled for 18:30 GMT.